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______- | I have a brother inlaw who will be in the same position not enough for 2 sibling to take over but too much debt to buy everyone out. 2 siblings not interested at all, but definately have spouses that will call a lawyer to get as much as they can, cause they're entitled to it. Wife and I know it's to be his and money doesn't motivate me or my wife so I could care less if he gets it all and we get squat. Told the inlaws to set it up that he would receive 2% (pick your number) per year worked. If he was to then put 20 years in he would own 40% and upon death would recieve his quarter or an addition 15% of whole operation.
lets use a for example million dollar operation in above example would then only leave a 600 000 asset to be divided of which another 150 000 would be inherited bringing the total buy out amount to 450 000 for family member who paid there dues.
Giving a percentage payment lets the younger generation collect inflation on his wage. It can also leave more cash in the farm, depending on how much salary is drawn from the farm.
That is how a farm can be passed from generation to generation letting the successor be who best fits the criterea. Can also be splits of differing amounts
EX 2
Brother A works 5 years on farm age 20 - 25 he gets 10%
Brother B works 20 years on farm age 22 -42 he gets 40%
Brother C hates getting dirty leaves imidiately he get 0%
Sister and husband move back to help after Brother A
Leaves and worked for 15 years they get 30%
$10 000 000 estate
Brother A gets 1 000 000 compensation for 5 years labour
Brother B gets 4 000 000 compensation for 20 years labour
Brother C doesn't get any compensation from the farm pot
Sister gets 3 000 000 in compensation for 15 years labour
That totals 8 mil leaving an additional 2 mil to be split equally. If brother B and sister wants to buy out others cost is 2 mil 1.5 mil to brother A and
500 000 to brother C.
Plug your numbers in and change some variables see how fair this system is on your farm for your kids and if you agree with it. | |
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family farms where only a couple members farm?
