PARKER, COLO. (RFD-TV) — The shift in congressional control following the 2026 midterm elections could set the stage for significant changes to federal farm tax policy in the years ahead. From estate tax exemptions and capital gains to equipment depreciation, farmers may need to prepare for a different tax environment beginning in 2029.
Farm CPA Paul Neiffer joined Market Day Report to discuss potential changes, why the 2028 election could matter for farm families, and what producers should do now to protect their operations and estates.
Major Tax Changes Unlikely in the Immediate Future
In his interview with RFD-TV, Neiffer explained that although President Donald Trump retains veto authority, he believes this will make major tax policy changes less likely in the near term.
However, now that Democrats have secured control of both the House and Senate, a new political landscape has emerged in Washington.
He said the immediate outlook for a new Farm Bill is also uncertain, with disagreements between Republicans and Democrats potentially complicating negotiations.
Neiffer believes the bigger concern for farm families could come after the 2028 elections, depending on which party controls the White House and Congress.
Estate Tax Exemptions Could Be at Risk
One of Neiffer’s biggest concerns involves the federal estate and gift tax exemption.
Under current law, the basic estate and gift tax exclusion is $15 million per individual for 2026, following changes enacted in 2025.
Neiffer said a future Democratic-controlled government could look to reduce that exemption, potentially bringing it down to $3.5 million or $5 million.
He also raised concerns about possible changes to the stepped-up basis rules, which allow inherited property to receive a new tax basis generally tied to its fair market value at the owner’s death.
Changes to those rules could create additional capital gains tax exposure for families transferring farmland and other appreciated assets.
Another possibility Neiffer raised involves Social Security tax changes that could subject more farm income to the 12.4% Social Security payroll tax, potentially without the current income cap.
Equipment Write-Offs and Other Tax Provisions Could Change
Neiffer also pointed to the possibility of changes to bonus depreciation, which allows businesses to deduct the cost of qualifying equipment and other property more quickly.
Current law provides a permanent 100% first-year depreciation deduction for qualifying property acquired and placed in service after January 19, 2025.
He said a future Congress could look at rolling back some of those benefits as part of broader tax reform.
For farmers making major equipment purchases or planning business investments, changes to depreciation rules could affect the timing and financial benefits of those decisions.
Estate Planning Before 2028
With potential tax policy changes on the horizon, Neiffer encouraged farmers to begin working with their CPAs and estate planning attorneys now.
He said producers do not necessarily need to make major estate transfers immediately, but they should have plans prepared so they can act if the political and legislative outlook changes after the 2028 election.
Neiffer specifically cautioned that Congress could potentially make future tax changes retroactive, meaning waiting until 2029 could be too late for some planning strategies.
He also encouraged farm families to consider whether making gifts sooner could help protect their estates under current rules.
“I think what they should be doing is working with their CPA and their estate tax attorney to sort of get it in place,” Neiffer said.
