Proposed Change to Section 1031: Exchanges of Subsidized Agricultural Land or Farm Land
The Farm Bill that is currently pending before the United States Congress contains a provision that would affect Section 1031 of the Internal Revenue Code, including the exchange of subsidized agricultural land (ag land) or farm land.
Essentially, farm land that is subject to the payment of subsidy payments can only be exchanges with other land that is also subject to the payment of subsidy payments. The farmer (investors/taxpayer) could not exchange subsidized ag land for non-subsidized ag land unless the farmer gave up the subsidy.
Lobbying Efforts
The Federation of Exchange Accommodators is lobbying heavily against this bill. I will keep you updated on its progress.
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