The National Council of Farmer Cooperatives wants the U.S. Treasury Department to fix the proposed rule they’ve put out for Section 199A expensing. The exemption is used by farmers and ranchers doing business with both cooperatives and private grain companies. NCFC President and CEO Chuck Connor says the Treasury Department proposed regulation would only allow the tax break on patronage income and not non patronage income. He says that proposal would increase taxable income for farmers by $50,OOO.
He says the Treasury Department’s rule goes against an earlier deal reached between cooperatives and Congress.
Connor says Treasury Secretary Steven Mnuchin said this week he may have a resolution to the problem.
Connor says the inability to deduct non patronage income would hurt any cooperative that has a significant business with anyone who is not a cooperative member.
