Powerful Citrus Tax Incentive Now Law

Tacy CalliesLegislative

By Mike Sparks
Executive Vice President/CEO, Florida Citrus Mutual

citrus taxI want to make sure this great news did not get lost in the holiday season. The tax bill recently signed into law by President Trump contains our citrus tax expensing provision that we have been working hard on for more than three years! The new law took effect on December 22, 2017 and will sunset on December 22, 2027. The law allows growers to deduct tree acquisition costs as well as costs associated with subsequent planting, cultivating, maintenance and development.  In addition, if growers acquire new acreage that is blighted, they are now allowed to take these deductions regardless of who suffered the blight. Plus, if a grower maintains at least 50 percent ownership of the acreage in the year new costs were incurred, the grower is allowed to take advantage of the deduction.

All growers should cross-check specifics with their accountant, who will have a much better idea of what items fall into the planting, cultivating, maintenance and development of trees.  A good rule of thumb will be whatever costs were deemed to be depreciated items in the past are now expendable. This law didn’t expand the items that can/should be deducted. Rather, it provided new opportunities for growers to expense these costs to incentivize more capital for replanting.

Prior to the devastation of Hurricane Irma, this tax measure was one of the most important federal initiatives pursued by Florida Citrus Mutual. We think the tax incentive will provide a strong tool for growers to get back on their feet, replant and build a sustainable future for Florida citrus. I would like to personally thank Congressman Vern Buchanan for his tireless work to get the bill passed. He is a true champion of our industry. Congressmen Tom Rooney and Dennis Ross as well as Senators Bill Nelson and Marco Rubio were also essential to passage and should be recognized.

Please click here to read Congressman Buchanan’s release.

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