HF 2310 (LSB 5543YH (3) 84)

HOUSE FILE 2310

BY  CHAMBERS

A BILL FOR

An Act exempting from the inheritance tax any agricultural land passing to nieces or nephews and including an applicability provision.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:

    Section 1.  Section 450.10, subsection 6, Code Supplement 2011, is amended to read as follows:
   6.
  a.  Property, interest in property, or income passing to the surviving spouse, and parents, grandparents, great-grandparents, and other lineal ascendants, children including legally adopted children and biological children entitled to inherit under the laws of this state, stepchildren, and grandchildren, great-grandchildren, and other lineal descendants, is not taxable under this section.
   b.  Agricultural land passing to a niece or nephew is not taxable under this section. For purposes of this paragraph, “agricultural land” means real property owned by a person in tracts of ten acres or more and not laid off into lots of less than ten acres or divided by streets and alleys into parcels of less than ten acres, and that has been used for the production of agricultural commodities during three out of the past five years. Such use of property includes but is not limited to the raising, harvesting, handling, drying, or storage of crops used for feed, food, seed, or fiber; the care or feeding of livestock; the handling or transportation of crops or livestock; the storage, treatment, or disposal of livestock manure; and the application of fertilizers, soil conditioners, pesticides, and herbicides on crops. “Agricultural land” includes land on which is located farm residences or outbuildings used for agricultural purposes and land on which is located facilities, structures, or equipment for agricultural purposes. “Agricultural land” includes land taken out of agricultural production for purposes of environmental protection or preservation.
    Sec. 2.  APPLICABILITY.  This Act applies to estates of decedents dying on or after July 1, 2012.
EXPLANATION
   This bill exempts agricultural land passing to a niece or nephew from the inheritance tax. “Agricultural land” is defined in the bill.
   The bill applies to estates of decedents dying on or after July 1, 2012.