The start of the COVID-19 pandemic more than six years ago highlighted the fact that local businesses are particularly sensitive to financial crises. The very same family-owned operations that line our streets, provide jobs, boost our economy, and make our communities vibrant are the ones that often need our support the most.

One tool we can use to achieve this goal is to modernize the family business and family agricultural asset exemption to the inheritance tax – legislation we will soon be introducing to do just that.

First, our legislation would reduce the amount of time a family business or agricultural family business must have been in the same family, from seven years down to five years, to qualify for an inheritance tax exemption. We’ve heard from families in the aftermath of the pandemic that this provision harmed them as their businesses were on the verge of closure.

Second, the bill would increase the maximum amount of assets a qualified family-owned business may have to qualify for an inheritance tax exemption. Currently, the limit is $5 million. Our legislation would increase that amount to $6.9 million, adjusted annually for inflation up to a maximum of $10 million. A relatively successful local business can easily exceed $5 million in assets if it owns a physical space in which it operates, a complex piece of equipment, and more.

These changes preserve the original purpose of the provision – to keep family businesses in the family – while granting them some much-needed flexibility. Please join us in co-sponsoring this important legislation.