Farm Estate Tax Deduction with 2032a - With the Natural Gas Phenomenon contiuing in many parts of Pennsylvania, questions regarding Estate Planning have become abundant. One question that I am hearing from some farmers is the question of Special Land Use Valuation. Basically, if my farm enterprize continues after my death, are there any Federal Estate Taxbreaks given to the inheritors of my farm? The answer is yes based on the Internal Revenue Code Section 2032A, Special Land Use Valuation.
The purpose of Section 2032A is to allow farmland to be valued as farmland. In essence, it establishes a productive value that is less than the farmland's fair market value. I will try to delve into the specifics of section 2032A in future blogs. In the meantime, if you would like more information, here is good resource.
IRS Publication 448 Federal Gift and Estate Taxes
P.S. Please keep in mind that section 2032A is related to farming enterprizes. This would not include future income derived from natural gas drilling and underground assets.
