RAPID CITY, S.D. –
When President Donald Trump signed tax reform into law just before Christmas, it culminated 3 years of tough negotiations for U.S. Rep Kristi Noem. A member of the House Ways and Means Committee, Noem was driven to get involved, because tax laws nearly cost her family their farm when her father died.
With a lot of information and misinformation being dispensed after the reform bill was signed, NewsCenter1 spoke with the Congresswoman to discuss what the tax reform law will mean for farmers and ranchers.
“This is a huge win,” Noem says, “not just for the people across the country, but for the people of South Dakota. ”
While many of the new tax cuts will help corporate America, Noem says the new reforms are aimed to give a boost to the so-called “little guy.”
“It’s definitely going to be the family farmer,” she says. “In fact, I had a farmer walk up to me the other day and say, ‘this bill looks like it was written by a farmer.’ And I said, ‘it was.’”
As for what’s in the bill, Noem is proud that farmers will be able to continue to deduct interest, which she says is an important tool for an industry that’s highly leveraged. Noem adds that immediate expenditures will prove to be an invaluable asset for farmers and ranchers.
“They go out and buy a new tractor or new feeder wagon,” Noem says. “They can immediately deduct it off the next year, which helps them re-invest in their operations.”
Noem also highlights the continuation of Section 179, which saw it’s $500,000 deduction quintupled to $2.5 million.
John Mitchell, a partner in Rapid City accounting firm Casey Peterson, Ltd., says one positive to come out of the new tax reform law is that farmers will be able to plan beyond the foreseeable future.
“The provisions in the tax bill that just passed in December are pretty much in place through the year 2025,” says Mitchell. “I think we know where we’re going to be for the next 7 years.”
The one thing Noem didn’t get this time around was a total repeal of the estate tax. However, lawmakers did approve doubling the deduction to $1 million.
“I wanted a full repeal of the death tax, just because it’s the only place in our code where we double tax somebody,” she says. “It’s an un-American tax.”