Federal tax policy has the potential to affect the economic behavior and well-being of farm households, as well as the management and profitability of farms. Because the overwhelming majority of U.S. farms are organized as passthrough entities—sole proprietorships, partnerships, and S corporations—farm households are affected by individual income tax rates and preferences, in addition to deductions, credits, deferrals, and other tax provisions that pertain to businesses. The recently passed Tax Cuts and Jobs Act (TCJA) of 2017 made significant changes to the Federal income tax system. The TCJA eliminates or modifies many itemized deductions and tax credits, while lowering tax rates on individual and business income. At the same time, the TCJA expands some business provisions, in particular those that relate to capital cost recovery. It also doubles the estate tax exclusion by raising the amount to almost $11.2 million for an individual. This report uses published and special tabulation data obtained from the Internal Revenue Service and farm-level data from USDA’s Agricultural Resource Management Survey to analyze the impact the TCJA could have on family farms. We estimate that as a result of the changes made by the TCJA, family farm households would have faced an estimated average effective income tax rate of 13.9 percent if the TCJA had been in place in 2016. Under the previous tax law, family farm households faced an estimated average effective income tax rate of 17.2 percent. Although average tax rates are estimated to decline across all farm sizes and commodity specializations, the effects of the TCJA on farm households vary by farm size. Estimates also suggest 0.1 percent of farm estates will be subject to the estate tax under the new law, down from the 0.86 percent under previous law.