Bill > HF1626

This bill eliminates the existing cap on tax credits for owners of agricultural assets who sell or rent land to beginning farmers, effectively removing previous limitations on credit allocation. Currently, owners can receive tax credits for selling or renting agricultural assets to beginning farmers, with credits ranging from 8-15% of sale price or rental income (up to specific maximum amounts). The bill removes previous language that limited total credit allocation to $6.5 million for taxable years beginning after December 31, 2022, and $4 million for taxable years beginning after December 31, 2023. The credits will now be available without an annual allocation limit, which should make it easier for agricultural asset owners to benefit from supporting beginning farmers. The bill also maintains existing provisions about credit eligibility, including requirements that rental agreements be at prevailing community rates and that sales to family members meet specific pricing criteria. The changes will take effect for taxable years beginning after December 31, 2024, giving farmers and tax authorities time to prepare for the new rules. The goal appears to be encouraging agricultural asset transfer to the next generation of farmers by making the tax incentive more accessible and predictable.

Budget and Finance

https://www.revisor.mn.gov/bills/bill.php?b=House&f=HF1626&ssn=0&y=2025