Tracy Press

Tracy's congressman proposes upping the estate tax exemption for small businesses and farm owners.

A new bill sponsored by Rep. Jerry McNerney,
D-Pleasanton, could exempt some farm and business owners from estate taxes.

McNerney told reporters Thursday that small businesses, farmers and ranchers pay more in estate taxes as property values in his 11th Congressional District continue to rise. The result, he said, is that many have to sell of pieces of their property, usually to real estate developers, to pay the tax bill.

"Most of them want to keep land in agriculture, and because of the estate tax they’re not able to do that," McNerney said.

The congressman’s proposal would exempt all inheritance valued at $3.5 million or less from the tax. Small businesses and family farms would be exempt for up to $8 million in value. Previously, the exemption limit was $2 million.

The exemption would have benefited third-generation Sunol rancher Tim Koopman, who had to pay $747,000 in taxes when he inherited the family’s 850-acre ranch from his father. His father also paid the tax when he inherited the ranch, founded by Koopman’s grandfather in 1918.

"We’ve gotten through the situation with the death of my parents. What we’re facing now is protecting my children," he said. "It would be a tremendous relief for them."

Koopman estimates the value of the land at nearly $7 million, and he intends to pass it on to his son and daughter, who want to continue the family’s ranching tradition even as urban development encroaches.

McNerney said the next step is to rally support for the bill. Previous attempts to reform the estate tax include a bill by Rep. Kenny Hulshof, R-Missouri, who proposed eliminating the tax. His proposal gained wide Republican support in the House of Representatives, but the last action was when it was referred to the House Ways and Means Committee in May.

McNerney said the Ways and Means Committee still must investigate the fiscal impact of his bill, but he doesn’t expect it will have much effect on the federal budget. He added that while reform of the estate tax has been a Republican cause he hopes his effort will attract support from congressional Democrats.

"It’s an environmental issue," he said. "I want to see land stay in agriculture."

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written by mr bananas , November 02, 2007

Mr. Mc Nerney by the time the bill is passed, we will all be living in the street with no jobs, no home, and no estate to pass on to anyone. So what good will the bill do for Americans? Just see if you can help lower the gas prices.

m b