Fiscal Cliff Averted!?

Well the House and Senate finally came together to get something done. Congress passed and the President signed the bill that took care of several tax and spending issues that were going into effect on Jan 1.

Several portions of the bill have the potential affect many in Agriculture. The most obvious is the extension of the 2008 farm bill to the end of the fiscal year in Sept. In late 2012, Congress had extended the bill to the end of the calendar year. The action this week makes that extension a one year extension. This includes an additional full direct payment (as of now). Another issue that concerned farmers is that of the estate tax. Had this bill not been passed, the estate tax would have kicked in at the $1Million level. The bill brings that back to the $5Million level. It did though move the top estate tax bracket up to 40% from the previous 35%.

The message we want to make sure our members understand is that this is NOT the end of the story. We are facing another fight on the Debt Ceiling soon and that has the potential for truly setting the stage for a new farm bill and how much Congress will be able to spend on Farm programs moving forward. Additionally the 113th Congress will be looking at new members and new chairmen for the various committees. These could have a profound effect on the shape of future farm legislation. The new Congress has just taken office so the answers to many of these questions will start to form over the next few weeks. The Beltwide and the National Cotton Council Meeting as well as the upcoming Southern Southeastern Annual Meeting will be very interesting to see how things shake out.