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Committee advances two bills aimed at making beginning farmer tax credit more accessible
Summary
Lawmakers discussed two related bills: SF 14‑28 to expand eligibility to certain family LLCs and SF 14‑19 to remove a statewide funding cap; SF 14‑28 was passed and referred to Taxes as amended, SF 14‑19 was laid over for possible inclusion.
The committee considered two bills designed to broaden access to Minnesota's beginning farmer tax credit. Sen. Weber presented Senate File 14‑28 (A‑1 amendment adopted) to allow limited liability companies owned by up to two individuals who are spouses or family members to qualify for the beginning farmer tax credit. Sen. Weber said the change reflects ownership patterns in today's farm economy and would preserve the credit's intent while adapting to typical legal structures.
Hunter Peterson of the Minnesota Farm Bureau testified in support, describing liability and succession-planning reasons farmers use LLCs. Peterson and other testifiers said the expansion is narrowly tailored to family farm LLC structures. The committee adopted the A‑1 amendment and passed SF 14‑28 as amended to the Committee on Taxes.
Sen. Putnam presented Senate File 14‑19 to remove the total state cap on beginning farmer tax credit funding; testifiers — including Brad Kluber and Tessa Sedai Parks, both beginning farmers — said caps in recent years left eligible applicants turned away and that reliability of the credit matters when negotiating land and livestock contracts. Department staff indicated prior tax-year provisions would not be retroactive; program administration staff reported demand exceeded available funds in the last cycle and that prior fiscal estimates in the Taxes Committee assumed additional resources would be required.
The committee laid SF 14‑19 over for possible inclusion. Committee members noted the policy goal of easing farm transitions but acknowledged budget constraints and that a retroactive fix for applicants turned away in the previous year would be unlikely without additional revenue adjustments.
Ending: SF 14‑28 (LLC eligibility) passed and was sent to Taxes as amended; SF 14‑19 (remove cap) was laid over for possible inclusion.
