Tax bill loophole amended to help business connected to farming
by March 26, 2018 3:08 pm 295 views
A loophole in the recently passed tax bill that would have incentivised farmers to sell agriculture products to cooperatives instead of other types of businesses has been amended. The “section 199A fix” was passed Friday.
“Fixing Section 199A was a fundamental issue of fairness. We should not be picking winners and losers through the federal tax code by favoring one side over another,” U.S. Agriculture Secretary Sonny Perdue said. “During my travels across the country, I met with countless farmers and members of the agriculture community who were affected by this so-called ‘grain glitch.’ I applaud Congress for hearing their voice.”
The Tax Cuts and Jobs Act passed in December of 2017 had the section designed to preserve benefits for cooperatives and their patrons, and what it did is it disadvantaged the independent operators in the same industry, Perdue said.
Many members of the agriculture community began to raise questions about the potential market impacts on cooperatives and independent grain-related businesses.