Many family farms are not structured the same as they used to be. It used to just be enough to say you owned the land, the assets, and the livestock. However, we have come to learn that to relieve the tax burden and also to keep the family farm safe as a separate entity from the individuals who benefit from it, many farms are now Limited Liability Corporations or LLCs. As the government looks at these entities, they want to make sure that no tax evasion or unscrupulous business practices is going on.
That is why the Corporate Transparency Act was put in place, which is now in effect. Farmers may not realize that they are part of the stipulations in this bill. That is if the family farm is an LLC. Harrison Pittman is Executive Director of the National Agricultural Law Center, and he talks about what this law means.
Pittman talks about the process. It is the same for LLCs that are ag and non-ag-related. This has nothing to do with an urban versus rural America scenario.
This new rule will affect roughly 32.6 million LLCs across the country. What is upsetting to Pittman is the fact that this law was enacted with very little fanfare, and nobody has really taken the time to explain anything to any LLCs, agricultural or otherwise.
You can learn more about the Corporate Transparency Act at the National Ag Law Center’s website.
