(Des Moines) Iowa House District #18 Representative Ray Sorensen says the House passed legislation to avoid a tax increase on Iowa’s livestock farmers.
The Greenfield Republican says House File 2649 renews an exemption from paying capital gains for sales of certain animals, and absent its passage, Iowa’s hardworking livestock farmers would face more than $2.5 million in tax increases. The exemption expired for tax year 2023.
The bill allows a taxpayer to exclude the net capital gain from the sale of cattle or horses if held by the taxpayer for breeding, draft, dairy, or sporting purposes for more than 24 months, but only if the taxpayer received more than 50 percent of the taxpayer’s gross income from farming or ranching operations during the tax year. House File 2649 also allows a taxpayer to exclude the net capital gain from the sale of breeding livestock, other than cattle or horses, held by the taxpayer for 12 months or more from the date of acquisition, but only if the taxpayer received more than one-half of the taxpayer’s gross income from farming or ranching operations during the tax year.
Representative Sorensen says on the floor that House Republicans adopted an amendment to make the bill apply retroactively to the tax year 2023 to avoid a tax increase. The bill now goes to the Senate for consideration.
