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Central ND | If I step back and look at the whole farm as a business and the situations I've seen, it's kind of got me thinking.
You take a farm, have a father, son, brother, sister, etc together farming. Father dies, land gets split pretty equal among farming and other non farm siblings.
Now I'm not against each child getting their fair share so speak.
But the business side of me looks at it as, now the farm itself has lost a bunch of land that is given to the non farming children, who then rent it back to the farm. So not only has the farm lost equity, now it has to rent that land.
Or look at it like this, if Business A owned the land instead of father and farming children, when the father died, the land would still be part of the business. To involve the non farming, or non business employees, would somehow have to be a percentage or something. But Business A would still have the equity of the land to use at its advantage.
I guess from a business side of things, wouldn't it make more sense to keep the land with the business, paying out some money to non business children, than just giving the land away?
Looking for a good discussion here. Recent events over the last 5-10years I've seen on multiple different occasions have me starting to wonder, as well as starting to plan for my generational replacement.
Anybody have an experiences with non farming business that have passed on? Do non farming businesses just give away essential parts of the business to non business children?
Edited by case 3/27/2024 23:44
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How to wrap my head around generational transitions/equity?
