IRS Moves to Implement ‘Grain Glitch’ Tax Fix

Agricultural cooperatives would be subject to new reporting requirements under proposed Treasury regulations implementing Congress’ “grain glitch” tax fix.

The reporting requirements would help farmers determine their deduction under new tax code Section 199A when they generate income selling commodities to cooperatives, two senior Treasury Department officials told Bloomberg Tax June 17.

The 2017 tax law, as originally written, gave farmers a larger write-off for crop sales to agricultural cooperatives than to companies like Archer Daniels Midland Co. and Cargill Inc. It would have allowed them to deduct 20% of their gross sales ...