Succession Planning
A successful transition of a farm requires business continuity planning, business succession planning, personal financial planning and estate planning. Learn how to make these pieces fit together for your operation.
What makes a good family farm transition? It is difficult to achieve a good farm transition without at least doing well in each of these C’s.
The Proposed Transfer Tax can actually eliminate net equity for many farm families and cause their heirs to be underwater. It can be much worse than the current or proposed estate tax for most farmers.
Section 2032A allows the estate to pay less estate tax but will force heirs to pay more capital gains tax in the future. It effectively eliminates step-up in basis on inherited farmland if used.
With possible increases in estate and gift taxes looming, the use of an Intentionally Defective Grantor Trust (IDGT) may be appropriate to use in 2021.
Estate planning laws aren’t different for farmers versus others; however, there are variances, such as vocabulary, emotional ties to land, operation versus land, own versus rent, personal financial statement and deeds.
Here’s a checklist to use when reviewing your trust and will.
If you have decided to make succession planning a priority, we want to help you follow-through on that decision.
With so many components involved, it makes sense to periodically review your buy-sell agreement.
As you develop your estate plan, consider opportunities for charitable giving.