We just wrapped up a great Farm Futures Business Summit, and a common thread during many of the sessions on farm management and estate planning pertains to the unknowns that could come within some of the draconian tax proposals on the table and the impact it could have on agriculture.

“I’m starting to think if none of this happens by the end of the year, none of this will happen,” says Roger McEowen, ag law professor at Washburn University, after giving an hour-long presentation on the impacts and ramifications of some of those tax changes on the farming sector.  

“Remember how fast things seemed to be proposed, and how slow its mired down?” McEowen says of the initial proposals coming out in the early days of this administration and fresh off a Democrat sweep for each chamber in the 2020 elections.

For a timeline that once appeared to be passage ahead of the Fourth of July recess, that timeline is now rolling out into this fall and possibly not at all. For policy that could wreak havoc on so many farm businesses and the transition to the next generation, time for understanding the policies instead of just ramming it through is definitely what is needed to bring reason back to a debate that warrants studying those implications.

When USDA first tried to offer some positive spin on President Biden’s proposed tax changes, USDA claimed it would impact 2% of family farms. At the time that seemed impossible. The 2% is the exact opposite of what a new Texas A&M University study out this week revealing 98% of farms would be impacted.

Unveiled by House Agriculture Committee Ranking Member Glenn “GT” Thompson and Senate Agriculture Committee Ranking Member John Boozman, R-Ark., the study written by the Agricultural and Food Policy Center director Joe Outlaw confirms that if enacted, the two bills analyzed—the Sensible Taxation and Equity Promotion (STEP) Act, which proposes to eliminate stepped-up basis upon death of the owner and the For the 99.5 Percent Act, which would decrease the estate tax exemption—would have a devastating impact on the hardworking families that own and operate farms and ranches.

Related: Tax policy changes troubling farmers

In a media call on the report, Thompson states, “When it comes to raising taxes, Democrats cannot propose massive changes to tax policies and avoid impacting small businesses and family farms. No matter how much they talk about taxing the rich, the truth is that these tax policies will hit Main Street and farm lanes far harder than they will hit the titans of Wall Street or Silicon Valley.”

The STEP Act’s proposed changes to stepped-up basis mirror proposals discussed by the Biden administration. If it were to be implemented, 92 of AFPC’s 94 representative farms would be impacted with an average additional tax liability of more than $720,000 per farm. Together, the two bills would raise taxes an average of $1.4 million on 98% of AFPC’s representative farms. AFPC maintains a database of 94 representative farms in 30 different states.

“The data speaks for itself and should give pause to anyone considering this approach as an option to pay for new additional federal spending. If changes of this magnitude are pursued, as some have discussed, the economic harm it will cause will have a lasting impact on rural America,” Boozman says.

It's about understanding the facts, adds Thompson. In policy, that’s what matters.

“I think in any way that you look at it, but I think as more and more information comes out, then you’re going to see people on both sides really start to gel and understand. And then we’ll just have to wait and see what happens. But the first step is getting good information.”

And he adds as more of that information comes out, it’s going to make it more and more difficult to support these tax changes. In May, a letter signed by 13 House Democrats from rural districts began to show the crumbling support from Democrats and even House Agriculture Committee Chairman David Scott, D-Ga., expressed concerns.

“What’s not done by end of year, may not get done,” says McEowen on the tax proposals.

And for farmers that likely will bring a big sigh of relief.