Farmers face specter of higher 'death' taxes
What do Paris Hilton and the average American family farmer have in common?
The answer: A hefty estate tax that will soon dramatically increase if Congress fails to act.
While Hilton may have no trouble paying 55 percent on the estate she is set to inherit, many of the country’s aging agricultural producers, whose children could be facing the same tax rate as Hilton, would be forced to question the future of food production and face the potential end to their multi-generational farm or ranch.
“If we are burdened with millions of dollars of estate tax, it forces the break-up of ranches and farms. And it’s not good for the environment; it’s not good for future generations; and it’s not good for America in general,” California rancher Kevin Kester told Fox News in a recent interview.
Kester, like 97 percent of the nation’s farmers and ranchers, will be dealt a serious blow if death tax rates are allowed to jump from 35 percent on estate worth at least $5 million to 55 percent on estates valued at $1 million and up.
When Kester inherited a 22,000-acre ranch from his grandfather two decades ago, he paid the Internal Revenue Service $2 million. Now, if the death tax is allowed to skyrocket, Kester’s children could pay more than $13 million on the same 22,000-acre ranch, the Fox News story said.
"There is no way financially my kids can pay what the IRS is going to demand from them nine months after death and keep this ranch intact for their generation and future generations,” Kester noted.
Read, “Ranchers, farmers brace for 'death tax' impact” or watch the video above for more information.