Date of this Version
Cornhusker Economics, August 8, 2018, agecon.unl.edu/cornhuskereconomics
The dust still hasn’t completely settled from the changes made in December of 2017 to the tax code by the Tax Cuts and Jobs Act (TCJA), but we are starting to dig through the law to make some sense of what this will look like for ag producers. What we know for sure is that the changes are far reaching and complex. We also know that for most producers, the changes will result in a lower tax liability. The largest unknown is exactly how the new 199a deduction (20% passthrough) will need to be implemented. We are currently still waiting on regulations from IRS, which is expected to be hundreds of pages of details pertaining to this law alone. When we do get this release from the IRS, it is expected to just be the basics of the rules with more specific details following over the next couple of years. In difficult situations like this, it’s best to start with what is easy to sort out.