Succession planning rarely implements itself automatically, the first step should be contacting an attorney with succession planning experience.
PA Supreme Court rules that family farms do not have to comply with municipal ordinances that are stricter than state law.
The nature of agricultural land, being undeveloped and of high acreage, makes Pennsylvania’s farmland ideal for commercial solar projects.
The importance of farm transition planning has become increasingly understood and accepted by the agricultural community.
It is not uncommon in the farm community for real estate to be owned jointly by two or more owners. Many times, parents will transfer their real estate to more than one child as part of their estate and farm succession plan. Joint ownership of real estate often presents unique problems for the joint owners.
Some farmers have purchased whole life insurance as an integral part of their estate/farm succession plan. Some of our clients, who have purchased whole life insurance as part of their farm succession plan, however, are discovering, unexpectedly, that their insurance may lapse before their deaths, whether automatically or due to unaffordable premium increases.
Most farmers and land owners have heard of a like-kind exchange, which goes by several other names, including a 1031 exchange or a tax-free exchange. The primary purpose of an exchange is to reduce the federal income taxes resulting from the sale of real estate.
As part of the succession planning process, most farm owners anticipate the challenge of balancing the older (transferring) and the younger (receiving) generations’ financial needs. And, they know that a difficult decision about the fair distribution of assets among the on-farm and the off-farm children is inevitable. However, equally important in the succession planning process, discussing prenuptial and postnuptial agreements (“marital agreements”) comes as a surprise or is uncomfortable for many from a family or moral perspective.
In the closing days of 2017, the federal Tax Cuts and Jobs Act (“Act”) was enacted. Its impact will be felt by virtually every taxpayer on multiple levels. From a farm succession planning standpoint, the most impactful changes include reduction of individual and corporate tax rates, increases in the federal estate and gift tax exclusion amount, preservation of stepped-up basis and continuation of like-kind exchanges for real estate.
In the typical farm family, the parents’ estate plan is as follows: Farm assets to my farm son, Andrew, and non-farm assets in two (2) equal shares to each of my non-farming children, Susan and Charlie. While the intentions are clear, and while the wills that are prepared are clear, it is not guaranteed that such intent will be carried out. What is not clear is that, in such a situation, the will is often times not enough – it does not dictate where every asset will go in the event of someone’s passing.