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| My whole point of this post was to say (as farmers) "We have an amazingly good position, don't bicker about irrelevant stuff"
I am not saying change anything to the structure, as it is amazingly well suited for farms to advance equity, grow with many tax loopholes that enable rapid asset growth, etc.
I am merely addressing the fact that people continue to complain about the estate tax being a trouble... that they need to do some work with a lawyer to get around it. I maybe under guessing it on the 1 day statement, but if you just own a couple quarters and are near that threshold, that is all it should take. As assets grow in size and complexity, yes it will take more work... but that is just standard operating procedure then to put more effort into protecting it.
A simple Trust does not get you exempt from different types of death taxes. This is correct. But there are many different types of trusts you can setup. One that I have experience with (albeit I am speaking from a cliff notes version as they had weeks of lawyer time setting up the one i am referring to) is a Dynasty Trust. There is 2 heirs in the next generation of the enterprise. 3 total partners now (think parents 1 partner, 2 sons the other 2 partners). They are scattered across 5-6 states and have vertically integrated assets from fertilizer to ethanol... If all 3 were to die on a plane crash one day, it would tick on like a clock passing assets (into the 9 figure range) to the 2 grand children without a hiccup at all. And once they pass some means tests for their maturity, etc... then some control begins to get handed over.
So it does take some work yes as you get more complex, but there are many ways around it.
I do agree with the statement someone made about 'if there is a lot of siblings it will be hard to 'keep the farm together''. I do agree with that; if there is 4 children, and 1 quarter... yeah it will be sold. But some of the big farm agencies have been looking for their poster boy of 'some poor guy that lost his farm when his father died' for decades, they cant find one. The planning also goes into that as well about how to divy out assets to non farming heirs while being 'fair'. Some of our clients have been asking me that and I have pushed some to move some income into apartments, or some other physical assets that return good income so that when they die there is a diverse amount of assets to split up and then 'keep the farm together'.
True if you do that you won't build your asset base as fast at the end of your life on your farm... But that is the risk you take. If you put 100% of equity into the farm and then expect to split it up amongst 5 heirs... That is the predecessors fault, not the 'poor child that loses the farm'. That is why there needs to be planning and structuring, etc.
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Thoughts on all the talk/complaining about taxes/estate tax on here.
