H.R. 8591

[Congressional Bills 119th Congress]
[From the U.S. Government Publishing Office]
[H.R. 8591 Introduced in House (IH)]

<DOC>

119th CONGRESS
2d Session
H. R. 8591

To amend the Internal Revenue Code of 1986 to provide an exclusion from 
gross income of gain from the sale of qualified farm property to 
qualified family members.

_______________________________________________________________________

IN THE HOUSE OF REPRESENTATIVES

April 30, 2026

Mr. Massie (for himself, Ms. Perez, Mr. Roy, Mr. Davidson, Mr. 
Burchett, Ms. Boebert, Ms. Mace, Mr. Edwards, Mr. Burlison, Mr. 
Collins, and Ms. Fedorchak) introduced the following bill; which was 
referred to the Committee on Ways and Means

_______________________________________________________________________

A BILL

To amend the Internal Revenue Code of 1986 to provide an exclusion from 
gross income of gain from the sale of qualified farm property to 
qualified family members.

Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

This Act may be cited as the ``No Capital Gains Tax on Family Farms 
Act''.

SEC. 2. EXCLUSION FROM GROSS INCOME OF GAIN FROM SALE OF QUALIFIED FARM 
PROPERTY TO QUALIFIED FAMILY MEMBERS.

(a) In General.--Part III of subchapter B of chapter 1 of the 
Internal Revenue Code of 1986 is amended by inserting after section 121 
the following new section:

``SEC. 121A. EXCLUSION OF GAIN FROM SALE OF QUALIFIED FARM PROPERTY TO 
QUALIFIED FAMILY MEMBERS.

``(a) Exclusion.--Gross income shall not include gain from the sale 
or exchange of qualified farm property to a qualified family member of 
the taxpayer.
``(b) Definitions.--For purposes of this section--
``(1) Qualified farm property.--The term `qualified farm 
property' means any interest in real property located in the 
United States if, during periods aggregating 2 years or more 
during the 8-year period ending on the date of the sale or 
exchange of such real property, such real property was owned 
and used as a farm for farming purposes (within the meaning of 
section 2032A(e)) by the taxpayer.
``(2) Qualified family member.--The term `qualified family 
member' means, with respect to any taxpayer--
``(A) the spouse of such taxpayer,
``(B) a lineal descendant of such taxpayer, of such 
taxpayer's spouse, of a parent of such taxpayer, or of 
a parent of such taxpayer's spouse, or
``(C) the spouse of any lineal descendant described 
in subparagraph (B).
For purposes of the preceding sentence, a legally adopted child 
of an individual shall be treated as the child of such 
individual by blood.
``(c) Special Rules.--
``(1) Basis of qualified farm property.--For purposes of 
this section--
``(A) In general.--The basis of qualified farm 
property in the hands of a qualified family member 
following a sale or exchange described in subsection 
(a) shall be the adjusted basis of such qualified farm 
property in the hands of the taxpayer immediately 
before such sale or exchange.
``(B) Increased basis following 10-year holding 
period.--If, following a sale or exchange described in 
subsection (a), the qualified farm property is not 
sold, exchanged, or otherwise disposed of for the 10-
year period beginning on the date of such sale or 
exchange, the basis of such qualified farm property in 
the hands of the qualified family member (as of the 
first day following such 10-year period) shall be 
increased by an amount equal to the excess (if any) 
of--
``(i) the fair market value of such 
qualified farm property (as of the date of such 
sale or exchange), over
``(ii) the basis of such qualified farm 
property in the hands of such qualified family 
member (as otherwise determined under 
subparagraph (A)).
``(2) Election to have section not apply.--Rules similar to 
the rules of section 121(f) shall apply for purposes of this 
section.
``(d) Regulations.--The Secretary shall prescribe such regulations 
or other guidance as may be necessary or appropriate to carry out the 
purposes of this section, including with respect to the application of 
subsection (c)(1)(B) in cases other than where the entire interest in 
qualified farm property is not sold, exchanged, or otherwise disposed 
of for the applicable 10-year period.''.
(b) Clerical Amendment.--The table of sections for part III of 
subchapter B of chapter 1 of such Code is amended by inserting after 
the item relating to section 121 the following new item:

``Sec. 121A. Exclusion of gain from sale of qualified farm property to 
qualified family members.''.
(c) Effective Date.--The amendments made by this section shall 
apply to sales or exchanges after the date of the enactment of this 
Act.
<all>