America's family farms are built on generations of sacrifice. The land, the equipment, and the livestock aren’t luxuries. They're the tools of the trade, passed down from parent to child as both livelihood and legacy. But a proposal that has surfaced repeatedly in Washington continues to loom over family farms across this country, threatening to force families to choose between their land and their tax bill. Not because they sold anything or cashed out, but simply because their property went up in value.
That's the threat posed by a tax on unrealized gains. Consider the Miller family – a hypothetical, but likely familiar, American story. They've farmed the same 400 acres in rural Iowa for three generations. When Miller's grandfather purchased the land decades ago, it was worth a fraction of what it is today (just since the year 2000, average value per acre of land has shot up from $1,857 to $11,549 in 2025). Thanks to rising land values across the Midwest driven by demand, development pressure, and inflation, that same acreage is now worth several million dollars on paper. The Millers haven't sold a single acre. They haven't taken a massive profit. They wake up at dawn, manage their crops, service their equipment, and hope the weather holds. Their wealth exists almost entirely in the ground beneath their feet.
Under a tax on unrealized gains, the IRS would treat that increase in land value as taxable income, even though the Millers never saw a dime of it. Every year, an IRS agent would need to assess what the farm is worth. Every year, the family would owe taxes on gains they haven't realized and money they don't have. How do they pay it? Likely, they’d have to sell off part of the farm. And once you start selling, the legacy your grandfather built doesn't last long.
This isn't a hypothetical confined to Iowa. The American Farm Bureau has noted that the vast majority of farm assets, roughly 82 percent, are tied up in illiquid real estate. Farmers don't have liquid reserves sitting in brokerage accounts to cover arbitrary annual tax bills. They have land. And land, unlike a stock, can't be partially liquidated with a click.
The threat comes at a particularly difficult moment for American agriculture. Ongoing conflict in the Middle East has rattled global commodity markets, and farmers across the country are contending with rising input costs for necessities like fertilizer, fuel, and feed. While the Trump administration has provided strong support for farmers in the past year, these macroeconomic trends have squeezed margins to the breaking point. Inserting more uncertainty with an unpredictable (and likely unconstitutional) annual tax obligation on top of that is a pressure that could push families who have held on through every hardship finally over the edge.
New polling commissioned by the Alliance for IRS Accountability underscores just how alarmed Americans are by this prospect. A strong majority of respondents said taxing unrealized gains is simply unjustified, and nearly 70 percent said they are alarmed by the idea of IRS agents appraising the value of everything they own each year. That's not a partisan reaction — that's a gut-level understanding that this kind of policy invites government overreach into the most intimate corners of Americans' financial lives.
And that's precisely the problem. A tax on unrealized gains isn't just bad tax policy; it's an enormous expansion of IRS power. Proponents of such a tax have called for increasing IRS funding by $100 billion, with that money going toward assessing the value of farms, ranches, small businesses, and private property across the country on an annual basis. To implement it, the agency would need to assess the value of farms, ranches, small businesses, and private property across the country on an annual basis. That means more agents, more audits, more subjective determinations about what your assets are worth. For a family like the Millers, who may not have the resources to hire accountants and tax attorneys to contest those valuations, the power imbalance is staggering.
America's tax system runs on voluntary compliance. That only works when taxpayers believe the rules are fair, consistently applied, and don't threaten the very assets they've spent a lifetime building. A tax that forces families off their land to satisfy a bill on gains they never collected is not fair. It's punitive. And it is exactly the kind of IRS overreach that AIA was created to fight.
Lawmakers on both sides of the aisle should take note of where the American people stand. Farmers aren't billionaires. They're families holding onto something they built. Washington shouldn't make them, and anyone else in a similar position, pay for that.
Chuck Flint is President and CEO of the Alliance for IRS Accountability
America's family farms are built on generations of sacrifice. The land, the equipment, and the livestock aren’t luxuries. They're the tools of the trade, passed down from parent to child as both livelihood and legacy. But a proposal that has surfaced repeatedly in Washington continues to loom over family farms across this country, threatening to force families to choose between their land and their tax bill. Not because they sold anything or cashed out, but simply because their property went up in value.
That's the threat posed by a tax on unrealized gains. Consider the Miller family – a hypothetical, but likely familiar, American story. They've farmed the same 400 acres in rural Iowa for three generations. When Miller's grandfather purchased the land decades ago, it was worth a fraction of what it is today (just since the year 2000, average value per acre of land has shot up from $1,857 to $11,549 in 2025). Thanks to rising land values across the Midwest driven by demand, development pressure, and inflation, that same acreage is now worth several million dollars on paper. The Millers haven't sold a single acre. They haven't taken a massive profit. They wake up at dawn, manage their crops, service their equipment, and hope the weather holds. Their wealth exists almost entirely in the ground beneath their feet.
Under a tax on unrealized gains, the IRS would treat that increase in land value as taxable income, even though the Millers never saw a dime of it. Every year, an IRS agent would need to assess what the farm is worth. Every year, the family would owe taxes on gains they haven't realized and money they don't have. How do they pay it? Likely, they’d have to sell off part of the farm. And once you start selling, the legacy your grandfather built doesn't last long.
This isn't a hypothetical confined to Iowa. The American Farm Bureau has noted that the vast majority of farm assets, roughly 82 percent, are tied up in illiquid real estate. Farmers don't have liquid reserves sitting in brokerage accounts to cover arbitrary annual tax bills. They have land. And land, unlike a stock, can't be partially liquidated with a click.
The threat comes at a particularly difficult moment for American agriculture. Ongoing conflict in the Middle East has rattled global commodity markets, and farmers across the country are contending with rising input costs for necessities like fertilizer, fuel, and feed. While the Trump administration has provided strong support for farmers in the past year, these macroeconomic trends have squeezed margins to the breaking point. Inserting more uncertainty with an unpredictable (and likely unconstitutional) annual tax obligation on top of that is a pressure that could push families who have held on through every hardship finally over the edge.
New polling commissioned by the Alliance for IRS Accountability underscores just how alarmed Americans are by this prospect. A strong majority of respondents said taxing unrealized gains is simply unjustified, and nearly 70 percent said they are alarmed by the idea of IRS agents appraising the value of everything they own each year. That's not a partisan reaction — that's a gut-level understanding that this kind of policy invites government overreach into the most intimate corners of Americans' financial lives.
And that's precisely the problem. A tax on unrealized gains isn't just bad tax policy; it's an enormous expansion of IRS power. Proponents of such a tax have called for increasing IRS funding by $100 billion, with that money going toward assessing the value of farms, ranches, small businesses, and private property across the country on an annual basis. To implement it, the agency would need to assess the value of farms, ranches, small businesses, and private property across the country on an annual basis. That means more agents, more audits, more subjective determinations about what your assets are worth. For a family like the Millers, who may not have the resources to hire accountants and tax attorneys to contest those valuations, the power imbalance is staggering.
America's tax system runs on voluntary compliance. That only works when taxpayers believe the rules are fair, consistently applied, and don't threaten the very assets they've spent a lifetime building. A tax that forces families off their land to satisfy a bill on gains they never collected is not fair. It's punitive. And it is exactly the kind of IRS overreach that AIA was created to fight.
Lawmakers on both sides of the aisle should take note of where the American people stand. Farmers aren't billionaires. They're families holding onto something they built. Washington shouldn't make them, and anyone else in a similar position, pay for that.
Chuck Flint is President and CEO of the Alliance for IRS Accountability
