Tax Fairness for Farmers, Ranchers, and Small Businessmen Act of 1991

Tax Fairness for Farmers, Ranchers, and Small Businessmen Act of 1991 - Amends estate tax provisions of the Internal Revenue Code to exempt from recapture any use valuation benefits of a qualified heir who rents the property to another qualified heir on a net cash basis. Applies this provision retroactively in connection with the estates of decedents dying after 1976.

Repeals provisions of the Tax Reform Act of 1986 that eliminated income averaging.

Increases from 25 percent to 50 percent the allowable income tax deduction for the health insurance costs of self-employed individuals and makes the deduction permanent (under current law it will expire after tax year 1990).

Allows a one-time exclusion from gross income of up to $125,000 of gain realized by a farmer from the sale or exchange of land used for farming or ranching during the ten-year period preceding the sale.

Permits a full investment tax credit carryforward to certain farmers (current law requires a 35 percent reduction).