1. Transfer Ownership: The primary goal of estate planning is to facilitate the transfer of ownership and management of the farm business, farmland, and other assets. Estate planning ensures that the farm/ranch will be passed along to the intended party with as few complications as possible, and per your wishes, taking into account family situations, taxes, medical conditions.
2. Reduce Estate Taxes: The second goal of estate planning is avoiding unnecessary transfer taxes. Transferring ownership of assets can be very complicated for the layman, and amid the complex laws and confusing language is the potential for extreme transfer taxes. Very often transferring real estate through a trust will save or eliminate taxes. There may also be agricultural exemptions to take into account.
3. Secure Financial Future: The third goal of estate planning is to ensure financial security for all generations. Without proper documentation showing how assets should be allocated, the state has the ability to distribute the estate as it sees fit. Just as important, the estate can be set up so that the costs of medical care, funeral costs, and the costs of settling the estate are covered by the estate, rather than on the shoulders of the estate’s beneficiaries. The estate can also be set up to provide living costs, educational costs and more for the surviving heirs. The distribution of the estate, especially if one child wants to keep the farm, can also be set up so to be fair to all children.
4. Develop Management Skills: The fourth goal of estate planning in the farm/ ranch context is to develop the next generation’s management skills. With a properly planned estate, you and your family can choose the business ownership structure and asset transfer methods that allow the younger generation to participate in the management and ownership of your farm/ranch as soon as both generations are ready.
5. Keep Land in Agriculture: The fifth goal of estate planning may be to keep productive land in agriculture. There are different mechanisms that can be used to ensure that the farm/ranch will continue to be actively used in agriculture in the future, such as conservation easements, or even donations to charity.
Thomas Walters Estate Planning builds lasting relationships with our clients based on the highest standards of integrity and professionalism. We help our clients customize plans that meet their unique needs, concerns, and goals. We compassionately assist families after the loss of a loved one. We believe that a well thought out and professionally developed plan will provide peace of mind making transitions for generations stress free and cost efficient.