Legal Issues That Could Affect Agribusiness in 2025
/The Ag Business Council’s Annual Legal Update took place virtually, featuring several experts on legal issues facing the agriculture industry. Law firm Bryan Cave Leighton Paisner hosted the event, with opening remarks by BCLP partner Bob Thompson. The webinar was moderated by Zach Helder, Ag Business Council Director of Member Services.
Elsa Manzanares, partner at Stinson in Dallas, opened the program, saying, “You can expect tariffs to come out on day one of the Trump administration.” Regulatory risks associated with transactions involving China, she said, will continue to dominate international trade compliance considerations for U.S. companies. “China remains the long-term focus of U.S. national security and economic interests.”
Manzanares advises clients and legislators on U.S. and international regulations related to imports and exports. She has argued cases before the U.S. Court of International Trade, and was appointed to the Office of the U.S. Trade Representative to review antidumping and countervailing duty disputes under Chapter 19 of NAFTA. Aiming her advice at the international sector of the ag industry, she noted that “the fundamentals remain the same:”
Review harmonized tariff classifications
Implement a comprehensive trade compliance program
Understand your risk profile
Review guidance published by regulatory and governing agencies
Roger McEowen, Kansas Farm Bureau Professor of Agricultural Law and Taxation at Washburn University School of Law, directed his remarks on tax issues to farmers, livestock producers, agribusinesses and rural landowners, whose concerns are focused on what’s happening down on the farm. “The never-ending stream of legal and tax issues facing farmers and ranchers continues unabated,” he said. There’s never a dull moment, McEowen added. He hinted that a new farm bill could include revisions to the way IRS Section 180 might provide tax deductions for certain land purchases and land use expenses.
Turner Polzin, CPA and Principal at Kansas/Arkansas-based Adams Brown Wealth Consultants, said the key to developing a successful succession plan is to start early. “And talk, talk and talk,” he emphasized. He was referring to how important it is that family and business partners have a clear understanding of the situation and where family heirs and non-familial heritors fall in line. All involved need to know the difference between fair and equal, Polzin explained. Simply put, if one sibling has worked the farm as a lifetime occupation and intends to continue maintaining it, he or she is probably entitled to a larger share of the inheritance. But such details require professional guidance.
Luke Guetterman, CPA, a tax advisor at Forvis Mazars, one of the largest public accounting firms in the U.S., focused his presentation on some provisions in the federal tax statutes that will be sunsetting in 2025. He noted that the yearly inflation adjustment for federal income tax brackets would increase by roughly 2.8%. That adjustment is relatively more favorable than 2024’s 5.4%. “There will also be the expiration of the Qualified Business Income Deduction and reductions of the Lifetime Estate Exemption,” he noted.
Chicago-based Brett Legner, of counsel with law firm Mayer Brown and a professor of law at Loyola University Law School, discussed the Loper Bright case—a landmark Supreme Court ruling on federal administrative agencies’ power to interpret and federal laws with deference from the judiciary. In a 6-3 decision, SCOTUS rejected the Biden administration's argument that existing precedent, known as Chevron Deference, protected agencies as they adjudicated laws written by Congress. SCOTUS suggested individuals and private entities had a right to defend themselves from civil penalties before a jury. The justices argued the Seventh Amendment to the Constitution, which guarantees a right to a trial before a jury of peers, applies to cases involving administrative penalties. The decision has the potential to put additional limits on federal and state agency authority. “Administration change will affect current rules like WOTUS and other environmental regimes,” he said. “Many things are on hold right now.”