Bipartisan hopes for 199A fix in omnibus
Story Date: 3/20/2018

 

Source: POLITICO'S MORNING AGRICULTURE, 3/19/18

Although it's tough to get pretty much anything done in Congress these days, there's hope that lawmakers will include a fix for Section 199A of the GOP tax law in the omnibus this week. 


The omnibus needs to be passed by the end of the week to avert a government shutdown (yes, we're here again, folks), which makes it a promising vehicle for fixing the so-called "grain glitch" in the law. (The text of the omnibus is expected to be released tonight).


It remains to be seen if farm state lawmakers will be able to get the language into the bill, but Minority Leader Nancy Pelosi signaled recently that she was open to having a bipartisan conversation about fixing the glitch, which some took as a positive sign.


The fix is ready: A deal recently struck to tweak Section 199A seeks to level out the playing field between co-op and other businesses.


The way the law is written, co-ops have a big advantage over other types of businesses: farmers who sell their commodities to conglomerates like Cargill, independent grain operators or other companies not structured as co-ops can only deduct 20 percent of their net business income. The fix would repeal the 20 percent deduction of gross sales to co-ops, according to a summary posted last week by the Senate Finance Committee.


Thumbs up from grain: The National Council of Farmer Cooperatives and National Grain and Feed Association recently said they're on board with the including the fix in the omnibus. 

























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