I 

109TH CONGRESS 

1ST SESSION H. R. 3523 

To amend the Internal Revenue Code of 1986 to exclude from estate taxes 

the value of farmland so long as the farmland use continues and to 

repeal the dollar limitation on the estate tax exclusion for land subject 

to a qualified conservation easement. 

IN THE HOUSE OF REPRESENTATIVES 

JULY 28, 2005 

Mr. BISHOP of New York 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 exclude 

from estate taxes the value of farmland so long as the 

farmland use continues and to repeal the dollar limitation on the estate tax exclusion for land subject to a 

qualified conservation easement. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Estate Tax Deferral 

5 for Working Farms and Land Conservation Act of 2005’’. 
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1 SEC. 2. EXCLUSION FROM GROSS ESTATE OF CERTAIN 

2 FARMLAND SO LONG AS FARMLAND USE 

3 CONTINUES. 

4 (a) IN GENERAL.—Part III of subchapter A of chap5 ter 11 of the Internal Revenue Code of 1986 (relating to 

6 gross estate) is amended by inserting after section 2033 

7 the following new section: 

8 ‘‘SEC. 2033A. EXCLUSION OF CERTAIN FARMLAND SO LONG 

9 AS USE AS FARMLAND CONTINUES. 

10 ‘‘(a) IN GENERAL.—In the case of an estate of a de11 cedent to which this section applies, the value of the gross 

12 estate shall not include the adjusted value of qualified 

13 farmland included in the estate. 

14 ‘‘(b) ESTATES TO WHICH SECTION APPLIES.—This 

15 section shall apply to an estate if— 

16 ‘‘(1) the decedent was (at the date of the dece17 dent’s death) a citizen or resident of the United 

18 States, 

19 ‘‘(2) during the 8-year period ending on the 

20 date of the decedent’s death there have been periods 

21 aggregating 5 years or more during which— 

22 ‘‘(A) the qualified farmland was owned by 

23 the decedent or a member of the decedent’s 

24 family, and 

25 ‘‘(B) there was material participation 

26 (within the meaning of section 2032A(e)(6)) by 
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1 the decedent or a member of the decedent’s 

2 family in the operation of such farmland. 

3 Rules similar to the rules of paragraphs (4) and (5) 

4 of section 2032A(b) shall apply for purposes of sub5 paragraph (B). 

6 ‘‘(c) DEFINITIONS.—For purposes of this section— 

7 ‘‘(1) QUALIFIED FARMLAND.—The term ‘quali8 fied farmland’ means any real property— 

9 ‘‘(A) which is located in the United States, 

10 ‘‘(B) which is used as a farm for farming 

11 purposes (within the meaning of section 

12 2032A(e)), and 

13 ‘‘(C) which was acquired from or passed 

14 from the decedent to a qualified heir of the de15 cedent and which, on the date of the decedent’s 

16 death, was being so used by the decedent or a 

17 member of the decedent’s family. 

18 ‘‘(2) ADJUSTED VALUE.—The term ‘adjusted 

19 value’ means the value of farmland for purposes of 

20 this chapter (determined without regard to this sec21 tion), reduced by the amount deductible under para22 graph (3) or (4) of section 2053(a). 

23 ‘‘(d) TAX TREATMENT OF DISPOSITIONS AND FAIL24 URES TO USE FOR FARMING PURPOSES.— 
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1 ‘‘(1) IMPOSITION OF ADDITIONAL ESTATE

2 TAX.—If, at any time after the decedent’s death and 

3 before the death of the qualified heir— 

4 ‘‘(A) the qualified heir disposes of any in5 terest in qualified farmland (other than by a 

6 disposition to a member of his family), or 

7 ‘‘(B) the qualified heir ceases to use the 

8 real property which was acquired (or passed) 

9 from the decedent as a farm for farming pur10 poses, then, there is hereby imposed an addi11 tional estate tax. 

12 ‘‘(2) AMOUNT OF ADDITIONAL TAX.—Rules 

13 similar to the rules of section 2032A(e) shall apply 

14 for purposes of this subsection.’’ 

15 (b) CLERICAL AMENDMENT.—The table of sections 

16 for part III of subchapter A of chapter 11 of such Code 

17 is amended by inserting after the item relating to section 

18 2033 the following new item: 

‘‘Sec. 2033A. Exclusion of certain farmland so long as use as farmland continues.’’. 

19 (c) EFFECTIVE DATE.—The amendments made by 

20 this section shall apply to estates of decedents dying after 

21 the date of the enactment of this Act. 
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1 SEC. 3. REPEAL OF DOLLAR LIMITATION ON ESTATE TAX 

2 EXCLUSION FOR LAND SUBJECT TO QUALI3 FIED CONSERVATION EASEMENT. 

4 (a) IN GENERAL.—Subsection (c) of section 2031 of 

5 the Internal Revenue Code of 1986 (relating to Estate tax 

6 with respect to land subject to a qualified conservation 

7 easement) is amended by striking paragraph (3) and by 

8 redesignating the succeeding paragraphs accordingly. 

9 (b) CONFORMING AMENDMENT.—Paragraph (1) of 

10 section 2031(c) of such Code is by striking ‘‘the lesser of’’ 

11 at all that follows and inserting ‘‘the applicable percentage 

12 of the value of land subject to a qualified conservation 

13 easement, reduced by the amount of any deduction under 

14 section 2055(f) with respect to such land.’’ 

15 (c) EFFECTIVE DATE.—The amendments made by 

16 this section shall apply to estates of decedents dying after 

17 the date of the enactment of this Act. 

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