Online discussion focuses on reforming estate tax law

Issue Date: November 4, 2009

By Christine Souza
Assistant Editor

With Congress facing a deadline to act on the estate or inheritance tax, which taxes property as it passes from one generation to the next, farmers, ranchers and others who participated in an online discussion of the issue last week stressed the need to support the Family Farm Preservation Estate Tax Act.

H.R. 3524, introduced by Rep. Mike Thompson, D-Napa, and Rep. John Salazar, D-Colo., would exempt farm and ranch assets from estate taxes, as long as the property remains as a family agricultural operation.

Congress will likely move to act on estate tax legislation before the end of the year, because current law passed in 2001 will phase out the estate tax entirely in 2010—only to have it reappear in 2011 at pre-2001 levels. Farm organizations say that returning to the previous estate tax levels would severely damage a family's ability to pass a farm or ranch to the next generation.

To educate people about the benefits of the legislation for farm and ranch families, the California Farm Bureau Federation led a discussion of the estate tax issue during the Oct. 27 session of #AgChat, a live, online chat conducted via the Twitter social media site, where participants discuss issues important to agriculture.

"This #AgChat was a step in the right direction. I think we got our message across that everyone should support the Thompson/Salazar bill to exempt farm and ranch assets from estate taxes if the property stays in agriculture," said Josh Rolph, California Farm Bureau director of national affairs. "With Twitter, you are limited to the number of words that you use, so what you did say, you had to make count."

During the #AgChat on the estate tax, Rolph reported that an estimated 50 people from coast-to-coast actively participated in the discussion, and that many others may have monitored it.

Stanislaus County dairy farmer Ray Prock Jr., an active participant on Twitter who has a high number of followers subscribing to his online posts, served as guest moderator for the two-hour discussion.

"The minimum goal was to broaden the awareness of the estate tax problem throughout the United States—that it is not just a California problem—and we accomplished that," Prock said.

Participants in the online session expressed concerns about the impact of the estate tax on farm families, such as the selling of farms to pay for the tax and therefore the paving over of agricultural land.

Emily Robidart Rooney, who comes from a multi-generational farming family in San Joaquin County and serves as vice president of the Agricultural Council of California, discussed her family's experience with the estate tax on #AgChat.

"As any typical farm family, my family has had to do estate planning. Large expenses in life insurance and attorney bills are incurred in an attempt to avoid this tax," Rooney said. "Years of these costs do in no way guarantee that you're 'out of the woods' when it is time for a generational transition. That money would definitely be better utilized if it could be invested back into the family business and put toward buildings, tractors and other equipment."

Like the actions taken by Rooney's family, a participant in Nebraska said significant sums of money are being spent each year on updating estate tax plans. Another cited money going to attorneys' fees.

An additional concern focused on the next generation of farmers—those who may be stuck with the burden of paying an estate tax and who would be forced to sell rather than continue farming where earlier generations left off.

"A shrinking percentage of farmers is under the age of 45. The estate tax hurts the next generation of farmers and ranchers," Rolph said.

Participants in the online chat also discussed how estate taxes levied on farms affect consumers: a reduction in the nation's food supply; land taken out of agricultural production; a blow to the local food movement; and an assortment of environmental impacts.

Siskiyou County rancher Jeff Fowle said, "Blacktop and gated communities will not feed America and are far from being environmentally friendly."

"We need H.R. 3524. It's not perfect, it's not full repeal, but it does save us from the tax," Rolph said during the online discussion.

At the conclusion of the #AgChat discussion, participants cited a number of actions that would be beneficial in advocating for farmers and ranchers as it relates to the estate tax, such as contacting members of Congress, sharing personal stories, writing opinion pieces for news publications and taking part in additional social media outlets.

As a first-time #AgChat participant, Rooney said she appreciated the discussion.

"I really enjoyed the dialogue in the fast-paced environment. It allowed for an in-depth discussion about the political dynamics and why H.R. 3524 is so important now," Rooney said. "I saw the experience as Californians making the case to others in the country, to try to further our cause with an audience that is already participating in one way or another."

To follow the progress of the estate tax legislation, visit the California Farm Bureau Web site at www.cfbf.com and join Farm Team to receive online updates and Action Alerts.

(Christine Souza is an assistant editor of Ag Alert. She may be contacted at csouza@cfbf.com.)

Permission for use is granted, however, credit must be made to the California Farm Bureau Federation when reprinting this item. Top