United States Senator Mitch McConnell introduced the Protecting American Farmlands Act on Tuesday, a bill to provide farmers with capital gains tax relief and keep agricultural land in the hands of active producers. The legislation addresses a growing crisis in farmland retention, ensuring that retiring farmers can transition their operations to the next generation while preserving farmland for long-term agricultural use.

"Kentucky Farm Bureau is proud to once again stand alongside Senator McConnell in championing legislation that strengthens the future of American agriculture. The Protecting American Farmlands Act is the outgrowth of important work done through our Kentucky Farm Bureau Farmland Transition Initiative,” said Kentucky Farm Bureau President Eddie Melton.

Read the full bill here.

Kentucky’s farming landscape has changed significantly in the past two decades. Since 2002, the state has lost 1.4 million acres of farmland, a 10% decline. The number of farms has also dropped by 20%, while the average age of Kentucky farmers has increased to 57.1 years. As farmland continues to appreciate in value, farmers face increasing challenges in acquiring land, while outside investors are buying up farmland and either developing it for non-agriculture purposes entirely or leasing it back to operators—limiting farmers' ability to build equity in their land.

The Protecting American Farmlands Act builds on the work of the Kentucky Farm Bureau Farmland Transition Initiative, which seeks to keep farmland in production and ease financial barriers for retiring farmers. The bill provides critical tax relief, allowing landowners who sell to active farmers to roll the gains from that sale into an individual retirement account. By deferring taxes, this measure gives retiring farmers more control over their financial future while helping keep farmland in production.

President Melton added, “This legislation not only helps ensure that our nation’s farmland remains in the hands of active farmers, but it also provides retiring farmers with a viable pathway to transition their operations to the next generation. We look forward to the lasting impact this legislation will have on farming communities here in Kentucky and across the country."

By reducing financial barriers for farm transitions, this bill gives retiring farmers an option to sell their land without losing significant portions of their proceeds to taxes. It also provides a more flexible retirement strategy, addressing the common challenge of farmers being “asset rich and cash poor” in their later years.

Kentucky Farm Bureau has long been a leader in advocating for policies that support farm families, and this legislation represents a major step forward in ensuring the long-term viability of American agriculture.

For more information on the Kentucky Farm Bureau Farmland Transition Initiative, visit kyfarmlandtransition.com.