The Woodward News (OK) January 2, 2019
Jan. 02--Planning
for the future of a farm, ranch or business can be a lot more complicated than
just making a will, especially if there is more than one heir.
Whether the estate
is big or small, an inheritance is more than money or property. Many farms and
ranches in our area are legacies that have survived several generations.
"You want that
to continue, so one day your grandchildren can walk the land their
great-grandparents did, and take the same satisfaction in knowing what they do
every day is a vital part of our economy," encourages Farm Bureau.
"Every family situation is different, and the interest of the overall
health and success of your agricultural operation, the best thing you can do is
take a step back and look at your succession goals as critically and
unemotionally as possible."
The division of
assets, sharing control and management decisions, and transferring ownership
are things to consider while making setting your succession goals, according to
Farm Bureau.
"When doing
estate or legacy planning, it is imperative to identify what the final goal is.
Each person's plan looks different based on their needs and goals," says
Whitney Gum, CPA and tax manager for ENJ Financial.
"For example,
should the assets be held for end of life care, passed on to children, donated
to charity, or perhaps there is a business or family farm to transition to the
next generation. People work hard their whole lives to build a life and
accumulate assets, it is so important to have a legacy plan in place to make
sure everything they've worked for is preserved for the next generation or
available for their needs."
Gum explained 2018
and 2019 gift and estate exemptions are up drastically from 2017. A person can
gift or pass on through inheritance a certain amount in their lifetime before
they have to consider tax liability. Strategic planning is important,
especially if there are large assets.
Farm Journal Legacy
Project has several printable downloads online including a succession planning
action guide, family meeting agenda, conversations starters, a goals
clarification worksheet and more.
The Succession
Planning Action Guide has a checklist of things to consider and possibly take
action on beginning with the decision to secure the legacy. Identifying a
facilitator, scheduling consultations and conducting some initial research on
legalities are also suggested.
The Family Meeting
Agenda includes discussing roles, responsibilities and how each person may be
affected during transition. Other issues to discuss will be financial security
and estate tax provisions. Common objectives are operational integrity and
preparing the next generation for leadership.
According to the Farm
Journal Legacy Project, common obstacles to work through include
differentiating between equal and fair, active and inactive family members and
in-law participation. Developing a family employment policy with job
descriptions and accountability reviews is also a suggested discussion topic.
The Conversation
Starters worksheet recommends regular family meetings, "Your success
depends on the quality and quantity of communication within the family."
To start succession
planning, an accountant, insurance agent and investment advisor can help get
started. For more information on Farm Journal Legacy Project, visit farmjournallegacyproject.com
(c)2019 The Woodward News
(Woodward, Okla.)
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