One Big Beautiful Bill contains tax benefits, farm bill provisions

By MORGAN KUNTZ-GARRISON, For The Prairie Star

The One Big Beautiful Bill (OBBB), a sweeping piece of federal legislation, was signed into law by President Trump on July 4. Included in the bill are several tax benefits that are favorable for farmers and ranchers and could have a significant impact on their bottom line.

First off, OBBB increased the Death Tax limit to $15 million for individuals and $30 million for couples, adjusted annually for inflation. This provision is a huge win for agriculturalists because it means if the value of your operation falls below limit, no Death Tax needs to be paid.

“This provision was huge and its not only important to ranchers, but its huge for every business owner on Main Street America, so we were very excited,” said Raylee Honeycutt, executive director for the Montana Stockgrowers Association (MSGA).

Continuing, Section 199A and Section 179 tax deductions were made permanent thanks to OBBB. Section 199A allows farmers, ranchers, and other small business owners to deduct up to 20 percent of their income and Section 179 allows producers to deduct the cost of equipment. Agriculturalists are now allowed to deduct up to $2.5 million in qualified equipment expenses and the phase-out threshold has been increased to $4 million. Like the Death Tax, these deductions will be increased annually for inflation.

Also made permanent by OBBB is the Bonus Depreciation Tax Provision. This allows producers to deduct the cost of equipment upfront, rather than depreciating the expense over the span of several years.

Lastly, itemized deductions of personal casualty losses due to federally declared disasters were originally extended under the Federal Disaster Tax Relief Act, which was enacted in December 2024. The OBBB made those extended itemized deductions permanent.

Honeycutt explained, the permanency of Section 199A, Section 179, and the Bonus Depreciation provision is a real win for agriculturalists.

“This will allow producers to make a plan and work the plan. Producers often make plans with their accountants and then in 10 years the tax laws may be different, so making these provisions be permanent really helps producers to make strategic, long-term decisions,” she explained.

While always front of mind, producer profitability has become a top priority for MSGA this year. The grassroots organization sojourned back to Washington, D.C. four times this past spring to meet with federal representatives and tax provisions was a key talking point, Honeycutt said.

“We were really excited to see these provisions in the One Big Beautiful Bill,” she added.

Tax benefits weren’t the only thing made possible by the passage of OBBB, as several farm bill provisions were also given funding since the status of the next farm bill still remains in question. The Livestock Forage Disaster Program, Livestock Indemnity Program, Animal Disease Prevention and several voluntary conservation programs received funding under OBBB.

“There were a lot of wins for agriculture in this bill,” Honeycutt articulated.

The passage of OBBB was of course a huge first step, but Honeycutt is quick to point out, there is still a lot that is yet to be determined, so the work is far from over, especially for grassroots, producer-led organizations like MSGA.