For many clients, estate planning also means discussing what will happen with the family farm. There is no one-size-fits-all farm succession plan, as each family situation is unique. For instance, some clients have a child who is farming the land and depends on it as his livelihood. In that case, the parents may want the land to stay together in trust for as long as that adult child wants to farm. Other families desire to protect the farming heir, but do not want to keep the land tied up for a long period of time. In that instance, the parents may want to hold the land together in trust for a period of time (i.e. 5 years), during which time the farming heir could have an option to purchase the land. Other families do not want to hold the land together, but they do want to protect the farming heir by placing a right of first refusal on the farm real estate. A right of first refusal means that if a non-farming child desires to sell the land he inherited, the farming heir would have the right to purchase the land at the price a third party offers for the land. Still other families have more than one farming heir or decide that they want to keep the farm going for multiple generations and in such a manner that an heir’s interest in the farm could be easily bought out by the other heirs. In those situations a Limited Liability Company may be desired. Every family farm is different, which is why Stacey Seibel takes the time to discuss with the client the advantages and disadvantages of different planning options and how such options may impact the family farm. |