AGRIBUSINESS: Family Farms Face Hard Times
Iowa Senator Chuck Grassley and Minnesota Senator Al Franken, have introduced legislation to reverse a Supreme Court ruling that has made it harder for family farmers to reorganize their finances in hard times.
The Family Farmer Bankruptcy Tax Clarification Act of 2013 would remedy a May 2012 Supreme Court ruling that said, despite the express goal of Congress to help farmers, the language inserted into the bankruptcy code in 2005 conflicted with the tax code.
The Grassley-Franken bill clarifies that bankrupt family farmers, reorganizing their debts, are able to treat capital gains taxes owed to a governmental unit as general unsecured claims. It removes the veto power of the IRS over a bankruptcy reorganization plan’s confirmation, giving the family farmer a chance to reorganize successfully.