Farmers Worry Tax Will Force Them to Sell History

By Colleen Chen, NEWS 9

OKLAHOMA CITY -- It is a tax that many people think applies to just the rich, but the state of the federal estate tax is on the verge of affecting farmers.

The federal estate tax is a tax on the transfer of property from a person who has died to the people set to receive it. That often includes loved ones.

In the case of farm life, it's passing on a way of life, but 2010 is a potential game changer for the tax. Farmers said their livelihood will be ended if nothing is done.

Curtis Roberts is a wheat producer and his fields hold generations of history.

"We're still farming land that my Grandad homesteaded in 1889," Roberts said.

He hopes to pass on the land to his sons but fears it may not happen.

"If we have a big tax bill, we don't have the money to pay the tax," Roberts said.

If Curtis Roberts were to die in 2010, it would not be an issue, but he certainly plans to live far past this year.

"It's going to change after 2010. We don't know what's going to happen in 2011," he said.

That's because a sliding scale to eliminate the estate tax has reached its end. Republicans pushed through the scale ten years ago.

"If we don't do something before December 31, then starting the first of year 2011, it goes right back to where it was in the year 2000," said Republican Congressman Senator Jim Inhofe.

Farmers said that is too much of a burden. For instance, a reasonable sized farm would be worth about $4 million. The estate would be given a deduction that would put the taxable value at $3 million. The max tax rate would be 55 percent that would bring a total tax bill of $1.65 million; a bill that most farmers can't handle considering their wealth is tied up in land and is not available in cash unless they sell.

Roberts said that's a tough pill to swallow.

"We work here from sun up to sun down raising crops to sell, to make a living. If taxes are so much that we cannot do that. We'll have to sell out," he said.