IRS Issues Guidance on Tax Benefit for Rural, Agriculture Loans

The IRS released guidance Thursday on a tax benefit for certain lenders that make loans secured by rural or agricultural real property.

Notice 2025-71 gives interim guidance for a new provision from the GOP’s multi-trillion dollar tax-and-spending law signed in July. The law allows for some lenders to exclude from gross income 25% of the interest they receive from loans secured by rural or agricultural real property.

The guidance provides standards for establishing whether a loan is secured by rural or agricultural property and rules for refinancing.