(TRENTON) – Legislation sponsored by Assemblywoman Celeste Riley (D-Cumberland/Gloucester/Salem) to help New Jersey’s farmers offset the economic risks associated with farm work was released Monday by the Assembly Agriculture and Natural Resources Committee.
“Weather and other factors can wreak havoc on a farming business. This credit would help New Jersey’s farmers make up for the losses suffered during bad seasons,” said Riley. “We are only as strong as our industries, so it makes sense that we help mitigate hardships that can cause them to fail.”
The bill (A-946) provides New Jersey farmers with a credit against their annual New Jersey gross income tax determined by using income averaging (averaging out yearly gains and losses or varying levels of gains over a four-year period) from their farming business. The value of the credit is equal to the difference between a New Jersey farmer’s income without four-year farming income averaging and with farming income averaging. The maximum annual credit allowed is $5,000.
Farmers face a variety of risks that impact their economic viability. Risks associated with production, weather, financial management, marketing and labor influence the potential for success. In order to assist farmers, the federal government enacted income averaging provisions that would allow farmers to have more control over the cyclical nature of agricultural risks and even out their tax liabilities for a more secure future. The tax credit under the bill would provide farmers with gross income tax relief in taxable years that follow the less profitable years of their farming business.
“New Jersey has a proud farming history. Let’s preserve this history by helping our farmers who not only grow the food we serve on our tables, but put the garden in Garden State,” said Riley.