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House bill introduced to give agriculture students a tax exemption

Posted at 7:26 AM, Apr 16, 2019
and last updated 2019-04-16 08:26:55-04

By creating a tax exemption for students involved with 4H and FFA, U.S. legislators are trying to enhance and encourage the long-term sustainability of agriculture.

A recently introduced U.S. House bill called the Student Agriculture Protection Act of 2019 hopes to be part of this solution.

A small change in the tax code could help encourage a new generation of farmers.

The Student Agriculture Protection Act of 2019 (H.R. 1770) would create a tax exemption for the first $5,000 of income students earn from projects completed through 4-H or FFA.

“Like for instance, like Houston has a cap of $75,000 for the grand champion so even though that calf brought $200,000 that kid only gets $75,000 of it, but he will get taxed on that $75,000. You have a lot of money that they put into this project, and they are still putting more money into it once the tax form comes,” said San Patricio County 4-H youth development extension agent Adrian Arredondo.

This bill would give an economic boost to young people in agriculture by allowing 4-H and FFA students aged 21 and younger to keep more of the modest income they earn.

“Absolutely, these kids, they get a tax form just like you and I do whenever we have our pay checks. They get taxed on every dollar they earn through the premium sales. And in some instances, that’s quite a bit of money they get taxed on,” said Arredondo.

The key lesson taught here, in a word, responsibility. 4-H and FFA leaders want these kids to continue working with livestock, and perhaps develop an interest in animal science.

“We have to remember these kids that are doing these projects now a days are our future in agriculture, and will be the ones that will be raising projects in years to come,” said Arredondo.

In effect, it will eliminate the tax-filing burden for eligible students and allow them to invest their earnings in future projects or college funds.

“At the end of the show year, you get to have more money that you can put in the bank after you have expenses, and more money that can be put away for your child’s higher education, or like I said, go back into a production agriculture,” said Arredondo.

With the number of new farmers trending downward and more mouths to feed than ever across the globe, this bill could be a big step in the right direction.

This bill eliminates needless barriers for our student farmers and allows them to save for future endeavors.

Ag projects completed by students under the supervision of 4-H clubs and FFA chapters may include showing animals at local and state fairs, growing and harvesting crops, building ag mechanics projects, and many other possibilities.

 The projects encourage personal growth and responsibility, while also providing opportunity for students to generate modest revenues.

The money earned by a student is often used to finance future ag projects, deposited in savings, or used to fund a college education.

The bill would protect students involved in 4-H and FFA and the money they earn from the IRS by lowering or eliminating the tax burden on the students.

District 11 4-H encompasses 18 counties from Nueces County to Washington County (Brenham). District 11 4-H is home to 5,500

4-H youth and about 1,500 volunteers.

District 12 encompasses much of the valley and into Webb County and Duval County. District 12 is home to about 4,000 youth in 4-H.

Currently, the Area 10 FFA Association has 11,740 members in 100 schools across South Texas.