August 2010 Archive for Leave a Legacy

 From Legacy Moment eNewsletter (08/27/2010)
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Though the purpose of most succession plans may be transferring ownership of the operation during the owner’s lifetime, many owners, for various reasons, maintain some level of ownership until death. If this is the case in your family, planning to transfer an ownership interest held at death means the transfer must also achieve other goals, including minimizing the estate tax, providing financial security for a surviving spouse and transferring the balance of ownership to the intended successors.

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 From Legacy Moment eNewsletter (08/20/2010)
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Too many professional practitioners equate estate planning for family agribusiness owners with succession planning. Although there is a degree of overlap between the two practice areas, their goals are wholly and completely different.

Succession planning is designed to provide a plan for the orderly transition of ownership from one generation to the next at the owner’s retirement, disability or premature death.

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• Succession planning focuses on transferring ownership to family members, co-owners, key employees and/or third parties as a going concern under specified conditions.
• Estate planning addresses transferring wealth to heirs, providing for survivors and minimizing the estate tax after death.
  

 

    

The estate tax is again looming on the horizon, so it’s important to recognize how an estate plan---to mitigate the estate tax---should dovetail into a comprehensive succession plan.

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• Common, off-the-shelf, estate planning strategies will not mitigate the estate tax and maintain an operation’s integrity for the family business owner.
• Focus first on your goals for succession, and then craft your estate plan to complement your succession solution.
• Plan for your ownership transition and the family’s financial security first; then consider the estate tax.
• There is no "silver bullet" to mitigate the estate tax; an effective plan will require a combination of tested tools and techniques.

News & Resources for You

Bloomington Harvesters, Inc., is a family corporation that custom harvests grain up and down the Midwest. They start in the South early in the summer and end up in Canada in late September. John is a co-owner and head of the family. John’s son Drew is just starting his third season managing a crew. He’s gradually assumed more responsibility and acted with an owner’s resolve to address challenges. John wants to transfer a controlling ownership interest in the operation to Drew.

News & Resources for You

 Leading the Change – Legacy Project Workshops
 The next series of Legacy Project workshops are scheduled for Columbia, MO on Wednesday, August 25thand Wichita, KS on Friday, August 27th.  Sign up online or call the Farm Journal Events Hotline for more information: (800) 909-3681. 

Legacy Project 2010 Report: The full issue is now available for free download.

More questions? You can always  Ask Kevin.