Although growers will face plenty of uncertainty in the 2026 growing season with grain prices, input costs and interest rates, the One Big Beautiful Bill Act passed by Congress last year will provide some significant benefits in the future. 

Advocates of the legislation believe it will lower the cost of borrowing for America’s farmers, reduce the tax burden on interest income for loans secured by real property for agricultural production, and lower the administrative burden for small farmers and ranchers employing temporary and seasonal workers. 

Tax Relief Central

One immediate change is the permanent 100% bonus depreciation for new equipment purchased after Jan. 19, 2025, and the Section 179 deduction is increased to $2.5 million (with a $4 million threshold). This allows for immediate, full write-offs for farm machinery and capital improvements, plus offering a 20% Qualified Business Income Deduction (QBID) and higher estate tax exemptions.

These changes reverse prior phase-outs, making it easier for farms to expense large purchases like tractors and combines in the year bought, rather than depreciating them over many years.

Instead of spreading costs (for example, a $500,000 combine) over years, farmers can deduct the full amount in the year of purchase. This could make expensive machinery, barns and land improvements more accessible by reducing the immediate tax burden. 

The estate tax exemption is significantly raised to $15 million per individual, or $30 million per couple, plus inflation adjustments, protecting more family farms from the so-called “death tax.” 

Improvements to PLC, ARC-CO

Passage of the…