Family business owners, farmers, ranchers and landowners face unique challenges surrounding how to preserve the family business or farm—a symbol of their heritage. Sadly, over 70 percent of all family businesses don’t survive the transition to the next generation.
Probate fees and other settlement expenses can significantly reduce an owner’s legacy. On top of that are the problems surrounding the fair distribution of those assets to heirs.
Land Rich, Cash Poor
The typical farm family is land rich, cash poor. With hundreds of thousands, if not millions, of dollars locked up in equipment, livestock, structures and land, the net worth may be impressive. But when you look at the cash flow, it’s another story entirely.
If your heirs can’t readily come up with the cash from other sources, they may have no recourse but to sell the farm just to settlement costs.
Estate Planning Solutions
Your farm or business poses two estate planning challenges:
1. How can you preserve it so that you can pass it on intact to the next generation
2. How will you equitably distribute it among your heirs.
Achieving these two goals means planning in advance, and implementing strategies that give you maximum control over how, when, and to whom ownership of your farm transfers. Contact our office for more information about your options.
Also be sure to read more about Business Planning and Asset Protection strategies here.