Senators Chuck Grassley and Al Franken have introduced legislation to reverse a Supreme Court ruling that is making it tougher for producers to reorganize their finances when they fall on hard times. Grassley says the legislation puts back into effect a provision of the original bankruptcy code enacted in 2005.
Grassley says their bill clarifies that bankrupt producers reorganizing their debts are able to treat capital gains taxes as general unsecured claims. It removes the Internal Revenue Service’s veto power giving the farmer a chance to successfully reorganize.
Grassley says the legislation is a common sense fix to ensure the law is carried out as it was intended so farmers going through bankruptcy can keep their land and repay their debts.