Legislation being circulated by Dem lawmakers would create a $5 million annual tax credit program for early-career farmers, helping to offset the cost of acquiring land and other farming assets.
Sen. Mark Spreitzer of Beloit and Rep. Jenna Jacobson of Oregon recently sent a co-sponsorship memo to other lawmakers on the Farming Forward Program. They say the state’s tradition of family farms is being threatened as farmers are aging and the number of farms and amount of farmland are on the decline.
The memo notes the average age of a Wisconsin farmer is 56.7 years based on the latest agricultural census from 2022, and the number of farmers aged 55-74 years is more than double the number of those ages 25-44.
Meanwhile, the number of Wisconsin farms dropped 16% between 2011 and 2021 while total farm acreage in the state fell by more than 5%, according to the memo.
“Farmers across Wisconsin have shared that one of the biggest hurdles to continuing and strengthening our agricultural legacy is expensive startup costs,” authors wrote, adding “many farmers who are looking to retire rely on income from selling or leasing the farm to fund their retirement, and may not be able to afford to sell or lease their land at a discount to a beginning farmer.”
Under their bill, the program would provide a 5% refundable income tax credit for both beginning farmers — defined as having a net worth below $200,000 and less than a decade of farming experience — and those who lease or sell assets to a beginning farmer. These could include agricultural land or machinery, equipment, facilities or livestock used in farming.
Beginning farmers could also claim a 5% tax credit for improvements on land and facilities.
The tax credit would be capped at $75,000 per taxable year, and could be claimed for up to three years per asset if it’s being leased. The program would be limited to $5 million per year in total tax credits.
The bill also lays out the process for claiming the credit, under which the beginning farmer and asset owner would have to submit an application to DATCP. This includes the early-career farmer’s business plan, information on education and training, and farming experience.
“Providing refundable tax credits to beginning farmers for assets or improvements ensures that they have the opportunity and capital needed to begin, maintain, and develop a farm,” bill authors wrote.
At the same time, they say offering these credits to established farmers would help incentivize them to sell or rent assets at a more affordable rate.
Spreitzer says family farms and agriculture are “central to Wisconsin’s heritage” as well as the state economy.
“Wisconsin’s farmers bolster our economy and feed our families, and we as a legislature should be doing all we can to support our current farmers, as well as the next generation,” he said in a statement on the bill.
The co-sponsorship deadline is Nov. 14.
See the bill text and release.
