Groups representing dairy and cattle producers have joined dozens of other ag groups calling for the restoration of some tax cuts. The National Milk Producers Federation (NMPF) and the National Cattlemen’s Beef Association (NCBA) are asking Congress to restore Section 179, a tax code provision that allows small businesses, including farms, to write off capital purchases such as equipment immediately, instead of over time.
“Farming requires significant investments in machinery and equipment,” said NMPF President and CEO Jim Mulhern. “By allowing farmers to immediately write off these purchases on their taxes, Section 179 gives producers an incentive to invest in their businesses while it reduced their record-keeping burden.”
Mulhern said restoring Section 179 will encourage farmers to purchase machinery and equipment in years when they have a positive cash flow. “On the other hand,” he said, “failure to restore Section 179 will add to the financial strains on asset-rich, cash-poor family farmers who already find it difficult to pass on their farms to the next generation.”
“Producers rely on a stable and predictable tax code in order to plan purchases, make investments and grow their business,” said [NCBA President and Victoria, Texas cattleman, Bob] McCan. “We are already at the eleventh hour for tax planning, and it is incredibly important that Congress pass these extenders as quickly as possible.”
NMPF and NCBA, along with other ag groups, want the maximum amount of annual expensing be restored to $500,000, as it was in 2013. They also want Congress to reinstate the 50 percent bonus depreciation for the purchase of new capital assets, including farm equipment.