Sponsors (22)
The bill offers targeted 30% tax credits and monetization options to help specialty‑crop farms modernize and adopt water‑saving precision technologies, improving farm efficiency and rural economic activity, while imposing federal revenue costs, administrative complexity, and uneven coverage limited to specialty crops through 2035.
Specialty-crop farmers and small farm businesses receive a 30% tax credit for qualifying precision or controlled‑environment agriculture equipment, with an option for a refundable payment or transferable credit, lowering upfront modernization costs and improving cash flow.
Farmers adopting covered precision and water‑saving technologies (sensors, irrigation, software, AI) can reduce input costs and water use, improving resource efficiency on farms.
Rural communities and local businesses may see increased economic activity and job opportunities from faster deployment of agricultural technology and related services.
All taxpayers bear the fiscal cost: expanding a 30% tax credit will reduce federal revenue and could increase budget pressures or crowd out other spending priorities.
Farmers, taxpayers, and administration will face higher compliance and administrative burdens because complex eligibility rules and cross‑references require new IRS/USDA guidance and enforcement.
Limiting the credit to specialty crops and to projects placed in service before 2035 excludes many other farmers and newer technologies, creating uneven benefits across the agricultural sector.
Based on analysis of 2 sections of legislative text.
Creates a 30% investment tax credit for qualified precision- and controlled-environment agricultural property for specialty crops, available through 2035 with an elective refundable option.
Creates a new nonrefundable investment tax credit equal to 30% of the basis of qualified property used in "innovative agricultural technology projects" for production, storage, processing, and packaging of specialty crops using precision agriculture or controlled environment agriculture. The credit can be elected as a refundable payment for certain taxpayers, is transferable under existing transfer rules, applies to property placed in service before December 31, 2035, and generally only to property the construction of which begins after January 1, 2025.
Official title: To amend the Internal Revenue Code of 1986 to establish a credit for investments in innovative agricultural technology.
Introduced February 27, 2025 by Mike Kelly · Last progress February 27, 2025