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Southern MN | Changes to estate tax law and real estate taxes on the state level.
First of all stepped up basis. The loss of stepped up basis will trigger large taxes when heirs sell the land and other assets they inherit. Also livestock operations, especially with large, expensive breeding herds benefit greatly from stepped up basis. But basis works in conjunction with estate rate at time of death.
Second Most are assuming that the federal estate limits/exemptions will be lowered. It doesn’t take a huge amount of$10-$15/acre land to reach the present level, and am guessing that it will be lowered by half or more with present administration. So your heirs will have to sell land to pay the estate tax, with no stepped up basis the land sale itself will generate large capital gains taxes, so it is kind of a double taxation snowball that leaves potential heirs with very little from generations of work and land paid for with after tax money.
Third they are also floating the idea of tax on unrealized gain, so if you have a piece of land you paid $2000 for and it is appraised at 10k they want to tax you for the $8000 gain on your property. Don’t know how this works in practice but a scary idea that they are talking about.
The amount of money we have been given by the govt is scary and sickening, and yes it will need to be paid back by taxes in some way. But from my view all of these taxes based on estates and unrealized gain will benefit a few of the huge corporate land owners and purchasers in our area, and will end many family farms. The same can be said for small
business owners. As usual the consequences will be felt by the small business man, while governments best friend, large corporations and entities will be the beneficiary.
A government “land grab” is not the correct term. It is a money grab by the gov which will destroy many small business families, and help the Bill Gates foundation or however him and others like him find a way to increase their land holdings immensely
Edited by Jrditchdigger 1/27/2021 08:30
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Land grab?
