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Tax Relief for Farmers: Farmland Sales and Retirement Plans

New rules allow farmers selling farmland to avoid capital gains tax if the proceeds are reinvested into individual retirement plans. This aims to support farmers in future planning and encourage the transfer of land to new generations of farmers. However, conditions must be met to avoid additional charges in the future.
Key points
Farmland sellers can avoid capital gains tax if they reinvest the proceeds into individual retirement plans within 60 days of the sale.
The land must be sold to an active farmer and used for farming purposes for at least 10 years prior to the sale.
If the new owner ceases to use the land for farming or sells it within 10 years, the original seller may face additional taxes.
The act increases the contribution limit for individual retirement plans by the amount of gain from farmland sales, allowing for greater retirement savings.
article Official text account_balance Process page
Introduced
Citizen Poll
No votes cast
Additional Information
Print number: 119_S_930
Sponsor: Sen. McConnell, Mitch [R-KY]
Process start date: 2025-03-11
Lustra uses Artificial Intelligence. Verify details in source documents.
Summarized by: gemini-2.5-flash-preview-05-20
Source data: api.congress.gov
AI work logs for this document launch

OFFICIAL LEGAL TITLE

A bill to amend the Internal Revenue Code of 1986 to exclude from gross income capital gains from the sale of certain farmland property which are reinvested in individual retirement plans.

FREQUENTLY ASKED QUESTIONS

What is the official ID of this bill?

The official print number for this legislation is 119_S_930.

Which chamber initiated this legislation?

This legislation was initiated in the Senate.

When did the legislative process begin?

The process officially started on 2025-03-11.

What are the main provisions?

Key points include:

  • Farmland sellers can avoid capital gains tax if they reinvest the proceeds into individual retirement plans within 60 days of the sale.
  • The land must be sold to an active farmer and used for farming purposes for at least 10 years prior to the sale.
  • If the new owner ceases to use the land for farming or sells it within 10 years, the original seller may face additional taxes.
  • The act increases the contribution limit for individual retirement plans by the amount of gain from farmland sales, allowing for greater retirement savings.
What is the specific legal status?

The current status is Introduced.

Where can I read the full text of this legislation?

The full official text is available at: View full text

Who is the primary sponsor?

The primary sponsor is Sen. McConnell, Mitch [R-KY].

What is the latest detailed status?

The latest detailed status is: Introduced in Senate

Is this summary verified?

Yes. This content was analyzed by AI and verified by the Lustra Judge System on 2025-12-23.

CATEGORIES

Taxes Agriculture Real Estate