There is always work to be done on the family farm, which makes estate planning a priority when leaving the farm to a loved one. When someone passes away, one’s possessions and property are distributed during probate. A court oversees this process that can take anywhere from 3 months to years to conclude, and complications might occur if anyone contests a will. Having a family farm tied up in probate could cause a lot of hassle, so here are a few ways one could avoid the probate process.
Trusts
Trusts offer a few benefits as they are private and not subject to the probate process. A living revocable trust allows a benefactor to edit this document as needed, and a trustee is often able to transfer property and other assets to the intended recipients in a timely manner.
Gifts
One might choose to give away the farm while still alive. Individuals and couples can give away certain amounts without taxes under gift tax exclusions, but this may or may not be applicable depending on the size of a farm. However, giving away a farm could lower the total amount of one’s estate so that estate taxes do not apply when one dies.
Making New Accounts
You might be able to create pay-on-death accounts for IRAs and more. One can fill out a form to name the beneficiary so that a transfer is made to this person when one passes.
There are a number of ways you could make preparations for your family so that they are taken care of when you are gone. To find out more about estate planning when owning a family farm, contact us today.
