Farm and Ranch Succession Planning
A lot of blood, sweat, and tears go into a farming and ranching operation. For most farming families, it’s your life’s work; sometimes even for generations. So, when it comes to succession planning, we know how important it is to ensure that your wishes and goals are understood and carried out.
Farm and ranch succession planning does not start with your run-of-the-mill will or trust. Whether you’re raising livestock or crops, you need estate planning tools and strategies that are specific to the unique issues, challenges, and circumstances that you face as a farm or ranch owner, including:
- The business side of your farm or ranch
- Commodities and assets
- Government loans and grants
- Leases, contracts, and easements
- Animals and equipment
- Generational and family needs
- And more
Here, we’re going to go over a few of the most common concerns that arise with farm and ranch succession planning and share some of the tools we can use to help.
I want to avoid guardianship and probate.
We get this a lot from our clients, and we completely understand. Farming and ranching are complex enough, so you’re looking for a smooth transition when it comes to succession planning. Having a guardian, or having to go through probate, can complicated matters and extend the timeline. Thankfully, there are estate planning tools to address this concern and help you avoid hiccups.
I want to keep my farm forever.
Many farming and ranching families feel like this way, my own grandparents included. You’ve put everything into your farm or ranch (perhaps your parents or grandparents did, too) and want to ensure that it stays in the family indefinitely. Your estate plan needs to consider the values and heritage of your family and the members who have put so much into the business. We get it, and we have resources and ideas to help.
I want to treat my kids fairly.
Another common concern is families with multiple children who all want different things. One child may not want to be involved directly in the farm or ranch, while others may want to follow in your footsteps and can’t wait to take over the land. You want to plan for ALL the kids, though, not just the ones who are taking over the farm. At McDonough Law, we know how to get creative and ensure that your succession plan truly plans for everyone.
I don’t want to liquidate or sell the farm to pay for long-term care.
Long-term care is expensive and paying for it is a concern for many, but most farm and ranch families don’t want to sell the family farm to pay for long-term healthcare. Our clients come to us with this a lot and our response is always the same; the more prepared you are, the better. We can help you set up tools today to help pay for long-term care down the road without having to dip into the family farm.
Tools and Options
As you consider the best way to organize your succession plan, look past the basic will and trust and consider some of the many tools and options that may be available to you, including:
- General Partnership
- Separate Living Trusts
- Restructuring the land
- Structuring the business separately
Many of these tools can be utilized, combined with other estate planning tools, and creatively structured so that your needs are met, and your wishes carried out.
Issues to Consider
As you begin interviewing or consulting with estate planning attorney’s, there are questions you should ask and issues you should consider. Not all estate planning attorneys are created equal, especially when it comes to farm and ranch succession planning. Ask about their knowledge of these issues to make sure they truly understand your needs:
- CRP payments
- Estate taxes
- Revocable trusts
- FSA subsidy programs
- NRCS programs
If you’re utilizing certain government programs, or have other legal agreements attached to your farm or ranch, you need to consider those as you plan and ensure that your attorney understands them, as well. The wrong tool or resource can affect your benefits, grants, loans, subsidies, rights, contracts, and more.
How to Get Farm and Ranch Succession Planning Help
At McDonough Law, many of us come from farming and ranching families ourselves – which means we get it. We understand your lifestyle, values, goals, and concerns. More importantly, we understand your options and how to help.
If you have questions, and want to speak with a trusted source, give us a call today. We’re standing by to take your call!