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H.R.173 - To amend the Internal Revenue Code of 1986 to exempt certain farmland from the estate tax.
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SECTION 1. EXCLUSION FROM GROSS ESTATE OF CERTAIN FARMLAND SO LONG AS FARMLAND USE CONTINUES.
(a) In General- Part III of subchapter A of chapter 11 of the Internal Revenue Code of 1986 (relating to gross estate) is amended by inserting after section 2033 the following new section:CommentsClose CommentsPermalink
‘SEC. 2033A. EXCLUSION OF CERTAIN FARMLAND SO LONG AS USE AS FARMLAND CONTINUES.
‘(a) In General- In the case of an estate of a decedent to which this section applies, the value of the gross estate shall not include the adjusted value of qualified farmland included in the estate.CommentsClose CommentsPermalink
‘(2) with respect to each of 3 or more of the 5 consecutive taxable years ending with the decedent’s last taxable year, the decedent’s gross income from the trade or business of farming exceeds 50 percent of the decedent’s gross income, andCommentsClose CommentsPermalink
‘(B) there was material participation (within the meaning of section 2032A(e)(6)) by the decedent or a member of the decedent’s family in the operation of such farmland.CommentsClose CommentsPermalink
‘(C) which was acquired from or passed from the decedent to a qualified heir of the decedent and which, on the date of the decedent’s death, was being so used by the decedent or a member of the decedent’s family.CommentsClose CommentsPermalink
‘(2) ADJUSTED VALUE- The term ‘adjusted value’ means the value of farmland for purposes of this chapter (determined without regard to this section), reduced by the amount deductible under paragraph (3) or (4) of section 2053(a).CommentsClose CommentsPermalink
‘(B) the qualified heir ceases to use the real property which was acquired (or passed) from the decedent as a farm for farming purposes, then, there is hereby imposed a recapture tax.CommentsClose CommentsPermalink
‘(2) AMOUNT OF RECAPTURE TAX, ETC- Rules similar to the rules of section 2032A(c) with respect to the additional estate tax shall apply for purposes of this subsection with respect to the recapture tax.CommentsClose CommentsPermalink
(b) Clerical Amendment- The table of sections for part III of subchapter A of chapter 11 of such Code is amended by inserting after the item relating to section 2033 the following new item:CommentsClose CommentsPermalink