Ag Wins with the New Tax Law: What Farmers and Agribusiness Owners Need to Know

The recently passed One Big Beautiful Bill Act (OBBBA) makes permanent many provisions from the 2017 Tax Cuts and Jobs Act — delivering big wins for agriculture.

From equipment write-offs to farm bill updates, the law provides clarity and long-term benefits for producers.

Key Provisions for Agribusiness

100% Equipment Deductions

Farm equipment, sheds, and tile purchased after January 19, 2025, can be fully deducted. The Section 179 limit also doubles to $2.5 million — providing flexibility to manage taxable income.

Qualified Business Income Deduction (QBID) Permanence

Farmers and cooperatives can now count on the 20% QBID deduction permanently. For example, $200,000 in farm profit could mean a $40,000 deduction, reducing taxable income significantly.

Estate Tax Stability

The estate tax remains in place, but exemptions stay higher than pre-2017 levels. This ensures farm families maintain favorable protections in transition planning.

Capital Gains Flexibility

Selling farmland to eligible farmers? You can spread capital gains tax payments over four years, easing cash flow during transfers.

Energy Provisions Phaseout

Wind and solar tax credits begin phasing out for projects started a year after enactment and placed in service after 2027. Farmers considering renewable projects should carefully evaluate timing and contract terms.

Farm Bill Updates

Higher reference prices for commodities- Flexibility to combine ARC and crop insurance for stronger coverage- Payment limits increased from $125,000 to $155,000 per individual- LLCs and S corps now treated as partnerships for payment limits, giving each owner their own cap

Bottom Line

For agribusiness owners, the new tax law offers greater certainty and expanded benefits across equipment, income deductions, estate planning, and crop support programs.

Next Step: Work with your advisors to update your tax and succession plans now — ensuring you maximize these new opportunities.

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