Tax Reform doubled the lifetime estate and gift exemption for years 2018-2025. This means that in 2019, you can gift during lifetime or have assets in your estate of $11.4 million and not owe any estate or gift tax. Your spouse has the same amount.
For many farm couples, they very easily could be worth $30 million or more and not owe any estate or gift tax. Discounts of around 30% (or more) reduce the value of land (or other assets) put into an LLC or other entity.
However, there is a chance that the lifetime exemption will revert to the old numbers (or even less). The House has proposed a new bill that will make the exemption revert back to the old law two years earlier. Some of the Presidential candidates propose making it even sooner or perhaps reducing it even lower.
This means that now may be the time to consider gifting some of your farmland to your kids; grandkids; or into some type of trust. We normally like to have grain, equipment and other assets go through an estate so we can get a step-up in basis and get a new deduction for the heirs. However, farmland is not allowed to be depreciated and if it will be in the family for multiple generations, a step-up does not create any value anyway.
If your net worth is over $10, now is a good time to discuss this with your estate tax planner. Waiting may cost your heirs a lot of money.
Also, remember that you and your spouse can give $15,000 each year to as many people as your like and this does not eat into your lifetime exemption. Make sure you take advantage of this each year.