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Removing and Replacing Production Deduction Risks Benefits for Farmer Cooperatives

 The head of the National Council of Farmer Cooperative is concerned about how tax law will treat a 17.4% tax deduction that could pass from cooperatives through to farmers but leave farmer cooperatives without the same financial benefit they now receive from the Section 199 Domestic Production Activities Deduction. Senate Republicans worked Tuesday to ensure passage of a $1.41 trillion tax-cut bill by seeking changes that would shore up the benefits to small businesses. Amid denunciations from Democrats and a small but vocal protest breaking out during the business meeting, the Senate Budget Committee voted along party lines early Tuesday afternoon in Washington to merge some provisions from different committees in the tax bill and advance the bill to the Senate floor.Sen. Charles Grassley, R-Iowa, told reporters Tuesday that a few key Republicans had indicated support for the tax bill, leading to just a few Republican senators who viewed the tax benefits for small businesses as not as attractive in the Senate bill compared to the tax cuts for larger corporations."That's the stumbling block we have to deal with right now," Grassley said. He added, "They know the necessity of getting a bill passed, and I don't know what it is going to take to satisfy them, but something's got to be done," Grassley said.

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