A bill that would allow farmers to depreciate farming equipment over five-years instead of seven has been introduced by Senators Amy Klobuchar, D-Minn., Debbie Stabenow, D-Mich., Jerry Moran, R-Kan., and Pat Roberts, D-Kan.,. Changing the depreciation schedule for agricultural equipment to five years would make the tax code more consistent and aid rural development by aligning depreciation and debt service, increasing farm income by over $850 million a year, and helping farmers and ranchers finance new equipment and replace worn-out machinery.
"By bringing tax fairness to our farms and ranches, our agricultural producers can purchase the modern equipment that will allow them to produce more while spending less," Klobuchar said.
Stabenow, chairwoman of the Senate Ag Committee, says this bipartisan effort will strengthen American manufacturing and American agriculture.
"Common sense dictates that depreciation schedules should match the typical length of debt service for farm machinery," Moran said. "By reforming the tax code, we will better align the code with the realities of agribusiness."
Roberts says that providing certainty in the tax code will go a long way in helping America's farmers and ranchers invest in their businesses and communities.