Legacy Project

5 Succession Planning Mistakes to Avoid

Fri, 28 Jul 2023 14:06:39 GMT

It’s time. You need to finally make your farm’s succession plan a priority. As you take a first or second or 20th step in the process, shoot to avoid some common landmines.

“Although there are a lot of scary stories out there about succession planning, there’s actually way more positive stories,” says Rena Striegel, president of Transition Point Business Advisors based in Des Moines, Iowa. “I encourage everyone to become one of those positive stories. Take that first step or break through the roadblocks so you can be one of those success stories.”

Listen in as Striegel discusses succession planning with Andrew McCrea on the Farming the Countryside podcast :

Here are the roadblocks Striegel sees farmers commonly face.

You engage only one professional.

“Our philosophy is a farm needs to have a collaborative team of professionals that helps them with the decisions and discussions around succession planning,” Striegel says.

This team can include a CPA, lawyer, business adviser, banker, insurance professional and others. By having all these viewpoints at the table, you ensure your plan is comprehensive and meets your goals.

“I personally do not believe any one professional can come up with a succession plan independent of the other professionals,” she adds. “We encourage farm families to work with their team to develop and implement their transition plan.”

Your plan is driven by tax implications.

Taxes, of course, are a big concern for farmers, especially with the new tax policies coming out of Washington, D.C.

“But if you do succession planning with the sole intention of reducing or eliminating taxes, you actually miss a lot of really valuable tools you could be utilizing if taxes were not the major goal,” Striegel says. “What we try to do with farm families is identify the true goal of the family. Almost always the goal isn’t: I want to transition in a tax-effective way. Most of the times it’s about making sure that my operation stays viable, multiple families can support themselves or the farm is going to be here for future generations.”

You ignore the elephants in the room.

Succession and transition discussions are stressful. Most of the time, they will include several topics you’d just rather not talk about.

“We don’t want to talk about someone dying,” Striegel says. “There’s a lot of things about these conversations that make people feel really uncomfortable. And so oftentimes, even families who communicate well tend to have a hard time being really open.”

If you fall into this category, Striegel suggests working with a mediator or facilitator to help ease the tension and encourage honest and focused communication.

You don’t draw lines between being a family and a business.

“The thing we have found that has really helped farm families is when we can separate the family dynamics from the business itself,” Striegel says. “We try to help families understand when conversations are business discussions versus family discussions.”

In having clear lines between family and business conversations and decisions, she says, you can remove some of the emotional pieces from the equation.

“When we separate those a little bit, it does make it easier for farm families to be able to communicate and make decisions together as a group,” Striegel says.

You procrastinate, procrastinate and then wait a little longer.

The worst option for farm families, Striegel says, is waiting until your farm or family is at a breaking point before seeking help. Don’t wait until a family member is threatening to leave the farm.

“Oftentimes when the family fractures, so does the farm,” she says. “If you think that you’re going to need help, it’s far better to seek that help out and bring those resources in to preserve your family relationships. Wherever you are, today is the day to start.”

Want to jumpstart your succession plan? The DIRTT Project by Transition Point Business Advisors is an all-inclusive guidance plan to help you transition your farm business. Learn more.

Avoid These 4 Family Business Sins

Tue, 25 Jul 2023 17:34:48 GMT

Here’s how you can avoid committing these harmony-harming mistakes

Family business is tricky. Profit goals can clash with personality dynamics. Unqualified people might lead key positions. Talented and motivated children might feel stuck in a predetermined path.

“There is great power and commitment in a family business,” says Val Farmer, a clinical psychologist who specialized in family relationships during his 30-year career. “But the family must get along and the business needs to make money.”

To meet your family farm’s goals, avoid these common missteps.

UNDEFINED ROLES

Family businesses often require an all-hands-on-deck model. “Children and parents, husbands and wives, extended family members and different generations may serve as employees, managers, shareholders and advisers at various times,” says Cari Rincker, principal attorney with Rincker Law . “These overlapping and potentially unclear roles can be a source of conflict.”

Match family members to the roles that best suit them, she suggests. Create specific expectations for everyone and respect the boundaries of their duties.

“Clear responsibilities help create ownership of and respect for business roles,” Rincker says. “It is nice to know others can jump in when needed, but when roles become too blurred, conflict can result.”

BLURRY BOUNDARIES

Farm families can easily slide between business and family needs and priorities, but they need to separate the family dynamics from the business itself, says Rena Striegel, president of Transition Point Business Advisors . Conversations need to be clearly business discussions or family discussions.

“When we separate those, it makes it easier for farm families to communicate and make decisions together as a group,” Striegel says.

DETRIMENTAL NEPOTISM

Of course, you want to favor relatives in a family business, but they must be qualified. “Adult children or siblings who are lazy, selfish, addicted or dependent rob the rest of the family members in the business of enthusiasm and motivation,” Farmer says. “Working around someone while walking on eggshells or carrying their load is no fun.”

Analyze how you treat, motivate and promote family members versus non-family members, Rincker adds.

“If nonfamily workers are held to a different standard than family workers, they will be difficult to motivate and retain,” she says. “A level playing field in terms of treatment and advancement is essential. A merit-based culture that holds everyone to the same standards can motivate everyone, whether family or nonfamily, to achieve more.”

ECHO CHAMBER

Family members often find a groove or don’t want to rock the boat. As a result, original ideas or new strategies stop surfacing. To avoid an echo chamber, consider an advisory board, Rincker says.

“A board can help ensure business decisions are handled professionally,” she says. “Consider nonfamily board members as they can improve the business’s prospects of managing and attracting both family and nonfamily talent.”

The Best of Both Worlds

Well-run businesses take on the caring qualities of successful families, says Val Farmer, a clinical psychologist and author . On the flip side, well-run families take on business sensibilities of successful businesses. Farmer says these are the qualities of successful family businesses that find that perfect middle ground.

Share a vision and commitment for long-term goals. They invest money and time to improve the abilities of their members.
Involve its members in the process of management and leadership.
Have systems of communication in place where ideas at the operational level are heard and make a difference.
Delegate responsibility and decision making to the lowest level possible.
Give abundant recognition and appreciation for the work being done.

To access resources and tools to help guide your succession planning journey, visit FarmJournalLegacyProject.com

You can learn more about succession planning at the 2022 Top Producer Summit! You can hear from Rena Striegel, Paul Neiffer and Polly Dobbs! Register now!

Build An All-Star Team to Guide Your Succession Plan

Tue, 25 Jul 2023 14:54:57 GMT

Move your succession plan forward with collaborative experts

Many brains are better than one. As you move forward with your farm’s succession plan, your professional team will be critical in helping you achieve your goals.

“Evaluate the team you’re working with now as well as anyone you’re bringing in new,” says Rena Striegel, president of Transition Point Business Advisors . “When you have a team that works collaboratively you will receive the best solutions.”

A comprehensive succession planning team can include a family business consultant, an accountant, an attorney, an insurance agent, a financial planner, a conflict-resolution specialist or a combination of those roles. You will also need a quarterback for your advisory team, usually from one of those professional categories, to ensure everyone stays informed

“If you have not hired someone to run the collaborative team, you are the quarterback,” Striegel says. “You call the shots. They work for you.”

Watch a video of Rena Striegel sharing advice on how to choose the right professionals:

Achieve More Faster

The goal of a collaborative team is for each member to bring his or her unique expertise to the table. Once all perspectives are considered your plan will have a higher probability of success, says Matt Roberts, chief planning officer at Syverson Strege .

“If you get your entire team in a room, it will be an expensive meeting,” Roberts says. “But how much will that reduce calls from when people are not on the same page?”

Advisors may be suspicious of the process because they feel like they are losing control of the relationship and project, Roberts says. But the plan a collaborative team generates will be easier to maintain going forward and offer your family better solutions.

Roberts suggests your team meets once a year on an ongoing basis.

“You’ll need to continually evaluate your personal situation, any tax law changes, etc.,” he says. “It’s a process that gets easier as you go along.”

Sample Interview Questions

As you evaluate and build your team, you need to answer two key criteria about your professionals: How do they behave? What do they know? The questions below, provided by Rena Striegel of Transition Point Business Advisors, assess if professionals have the correct experience and attitude to help your family.

How long have you been providing succession planning services?
How do you get paid for your services?
Are you willing to work collaboratively with my other professionals to develop the best solutions for my family and operation?
Do they listen to you fully and not interrupt?
Do they want to know about challenges in your family?
Are they likeable?

Want to find more interview questions and tools to guide your farm’s succession plan? Check out the Dedicated Internal Resource for Training and Transition (DIRTT) Project provided by Transition Point Business Advisors.

What’s included in The DIRTT Project?

All-inclusive succession planning guidance, at an affordable price
5 step-by-step online courses that seamlessly guide the process and can be done at your own pace
Straightforward guidance for the hardest transition planning situations from an advisor who knows agriculture
60-page comprehensive workbook containing worksheets and tools to guide the development of your succession plan
32 videos addressing critical questions and best practices to consider when developing your plan

Learn more about The DIRTT Project .

Are You Paying Your Kids for Farm Work? Consider a Roth IRA

Mon, 24 Jul 2023 20:53:17 GMT

During the summer months, you likely have seasonal help. If that team includes children or grandchildren, you might want to consider setting up a custodial Roth Individual Retirement Account (IRAs) for them. A young adult can sock away some serious cash in the next decade or three.

A Roth IRA can be similar to a savings account or 529 account, but it offers more flexibility and tax advantages, says Jessica Groskopf, agricultural economist and University of Nebraska Extension educator.

Listen to a “Nebraska FARMcast” with Groskopf:

What is a Roth IRA?

A Roth IRA is a retirement investment account that anyone with earned income can contribute after-tax earnings. Then, the investments within the account grow tax free. A custodial Roth IRA is when a parent or other adult opens one for a minor. At age 18, the child will become the owner of the account.

Roth IRAs can have fees associated with them, Groskopf notes, so be sure you understand those before opening an account.

A Roth IRA is different than a traditional IRA. With traditional IRAs, you deduct contributions now and pay taxes on withdrawals later, while Roth IRAs allow you to pay taxes on contributions now and get tax-free withdrawals later.

“Contributions to a Roth IRA will hopefully be reinvested over time, and then you’ll retain earnings on that,” Groskopf says. “A Roth IRA is really interesting because it allows that child to have lots of time to build compound interest on their earnings. The best thing we can do for savings and investments for children is to provide them time.”

A single filer with an adjusted gross income under $140,000 per year, regardless of age, is eligible to contribute to a Roth IRA account. People can contribute up to the annual limit or the total of their earned income, whichever is less. The annual limit for people under age 50 is $6,000 for 2022. You do not have to contribute funds annually.

Earnings can be withdrawn from a Roth IRA tax free after age 59½. If earnings are withdrawn before age 59½, those earnings can be taxed as income and charged a 10% penalty.

But, Groskopf says, there are two key exceptions to the earnings withdraw penalty:

Earnings can be used to pay qualified education expenses without penalty.
After a Roth IRA has been funded for five years, $10,000 in earnings can be withdrawn tax-free and penalty-free to buy a first home.

“If we’re talking about a younger investor, a Roth IRA might be a really cool tool to use to build wealth and save for things such as education, their first home or ultimately their retirement,” she says.

How Do Roth IRAs Compare to Other Options?

Families often put a child’s earnings in a savings account. This is a safe and secure option, Groskopf notes, but they are likely to have a lower rate of return when compared to a 529 or Roth IRA. Plus, contributions to a traditional savings account are not tax deductible.

A 529 account is a tax-advantage college savings plan. Similar to a Roth IRA, it is an investment account that is likely to earn a higher rate of return than a savings account. 529 accounts have no income limits or annual contribution limits, and anyone can contribute — parents, family members, friends, etc. However, funds must be used for qualified education expenses.

“So, 229 accounts are a bit limited,” Groskopf says. “Maybe you have a child or grandchild who you’re not sure of their career path or what type of education they will need in the future. Maybe you put in a significant amount of money, and then they decide on a different path for their life. At least the beneficiary can be changed for these plans.”

As noted above, a Roth IRA combines many of the benefits of a savings account and a 529 account, she says.

“Over the long run, it is likely it will earn a higher rate of return than a traditional savings account,” Groskopf says. “Another advantage of Roth IRAs is that they do not count as an asset for Federal Student Aid.”

Of course, a Roth IRA is an investment account, and investments always carry some level of risk. If you’re not comfortable with investing, be sure to work with a certified financial planning professional, CPA, tax preparer and investment adviser, she says. See if it is a fit for your family.

“As soon as a child is earning an income, I would encourage a Roth IRA — even if you have a 529 or another savings account,” Groskopf says. “That really provides them that opportunity to have that investment grow over time.”

Read More: “ Roth IRAs for Children Earning a Wage on the Farm ” by Jessica Groskopf and Doug Nelson

3 Reasons Your Family Could End Up in Court (And How to Avoid It)

Mon, 24 Jul 2023 15:59:17 GMT

The major causes can all be avoided with smart estate planning

You’ve heard the horror stories. The ones about farm families who spend months in court fighting over assets. The result? A destroyed business and fractured family.

Why does this situation play out over and over? After studying numerous family farm cases Kitt Tovar Jensen, staff attorney at Iowa State University’s Center for Agricultural Law and Taxation , points to three key reasons:

Disappointed beneficiaries. Heirs are surprised by what they find in their family’s will. Often assets were divided differently than they expected or unspoken agreements were not followed.
A failure to plan. This can include not having a plan at all or not finding the correct professionals to guide you to create the best plan for your farm and family.
Life events. People often don’t account for big live events, such as marriage, divorce, births, disability, death or disagreements.

By knowing these common hurdles, you can plan to avoid them. “Don’t wait to make or update plans,” Jensen says. “You and your family need to engage in family discussions before it’s too late.”

For instance, Jensen suggests updating your will when life circumstances or goals change. Then tell your family members about your desires – ideally at a family meeting.

“If you adjust your will due to new goals, write your reasoning for the changes in the updated will,” she says.

Also, be mindful of the beneficiary designations in your estate planning documents and assets. The language and defaults for these can vary by state.

“The No. 1 mistake is not naming a beneficiary,” Jensen says. “Check yearly to ensure beneficiary designations are up to date. Also, make sure everyone’s name is spelled correctly.”

Above all, Jensen says communication is vital in avoiding litigation. If this is difficult in your family, consider working with a trained mediator or other professionals.

“The investment of good counsel is minimal compared to the cost of mistakes,” she says. “This is not the place to cut corners.”

Ready to start your plan? Learn what “ not dead yet documents ” you should have in place now.

Who Gets What? Take This Important Estate Planning Step

Tue, 02 Aug 2022 12:20:58 GMT

You’ve heard the horror stories. Grandchildren in tears as they watch family farmland be auctioned off because their grandparents needed to liquify assets to satisfy the taxes. Or siblings who were once in business together now don’t talk to each other after one felt slighted because they didn’t receive the family’s antique tractor.

Succession and estate planning is difficult and time-consuming, but it is also a key step for a business that can grow into the future.

Regardless of where you are in the process, you can always take another step. Rex Brod, market president for U.S. Bank has worked with farmers as an ag lender for about four decades in the four-state area of Missouri, Kansas, Nebraska and Iowa. He always encourages farmers to take this step first.

Listen to Rex Broad discuss long-term estate planning with Andrew McCrea on the Farming the Countryside Podcast :

“First and foremost is to decide what am I going to do with my assets? Each farmer operating today needs to be thinking about what happens if I drop off the face of the earth tomorrow,” Brod says. “What’s going to happen to my spouse or my children? Who will manage the operation?”

The asset part is important, as you can assign heirs to each or a plan to sell them. Then from a management perspective, reflect on the wishes of your potential heirs.

“Oftentimes children who grew up on the farm no longer have an interest in it,” Brod says. “They’re successful in business in the city or they just don’t have an interest or the management ability to continue the operation.”

Once you take an honest assessment, he says, you can explore several options, such as renting out your acres or enlisting the service of a farmland management company.

Read More

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Are You Paying Your Kids for Farm Work? Consider a Roth IRA

Just remember to work out that first decision: What happens to the farm if I’m gone?

Once you work with advisers to create this basic framework, Brod encourages a regular review. At a minimum, review the plan every two to three years and make adjustments due to tax or circumstance changes.

4 Farm Succession Strategies

Thu, 19 Nov 2020 03:38:14 GMT

Here’s how to start, continue and succeed in your farm’s transition plan.

The odds are not in your favor. For your family business to survive and thrive across multiple generations, you must be proactive.

“As farm operations become more complex and the economy continues to challenge healthy financial performance, it’s more important than ever to talk about the generational longevity of your operation,” says Rena Striegel, president of Transition Point Business Advisors .

>> Don’t delay in creating or updating your succession plan. Join leading experts at the Legacy Project Conference, Jan. 28 in Chicago. Register at TPSummit.com

Follow these tips and strategies.

Keep the endgame in mind.

The first step is to be clear about your vision for the transition. Do you want to continue working at the farm? What role do you see yourself playing?

“For some people, farm transition planning is a sunrise, for somebody else, it’s a sunset,” says Shannon Ferrell, ag law professor at Oklahoma State University Extension.

Retirement is oftentimes viewed as the date when you turn in the keys to your tractor, Striegel adds.

“For most farmers, succession is a lot easier to talk about when ‘retirement’ is eliminated from the vocabulary and ‘transition’ is inserted,” she says. “This shift in thinking often allows decision makers to make way for future leaders more easily.”

Set the stage with your family.

Once you have a vision, bring the rest of the family into the conversation. Explain to your family you want to talk about the future of the farm, Ferrell suggests. Invite all stakeholders, including spouses.

“No one will cause you more trouble in this process than someone with an emotional stake who isn’t included,” Ferrell says.

Then select a date for the meeting. “Do not have this conversation at a holiday,” Ferrell says. “Yes, it’s convenient, but there’s already enough emotional charge around holidays. Let’s not add to that.”

Start the conversation with stakeholders.

The next step toward gaining clarity is to determine what other stakeholders want and what they are thinking, Striegel says. This can be done through informal conversations or simple interview questions.

“Give adequate time for these conversations so everyone can really dig into what people are thinking and feeling,” she says. “Being heard is a key component in these discussions. Ask more, talk less.”

Put words into action.

Once you know where you want to go and have had all the necessary conversations, bring your professional team into the conversation, Striegel coaches. At a minimum, you will need to include your lawyer, certified financial planner and CPA.

Don’t delay in creating or updating your succession plan. Join leading experts at the Legacy Project Conference, Jan. 28 in Chicago. Register at TPSummit.com

Prenuptial Agreements Protect Farms

Thu, 19 Nov 2020 03:32:10 GMT

Prenuptial agreements are far from romantic. But they can prevent a farm from facing a devastating asset loss or long-term hard feelings.

“I always tell people that nobody gets on an airplane thinking that it’s going to crash, but you still go over the safety instructions,” says Cari Rincker, principal attorney with Rincker Law in Champaign, Ill. “I look at prenups often the same way—they are the safety instructions for a marriage.”

Put simply, a prenuptial agreement is a pre-marital contract between two adults that details assets, obligations and future wishes. It puts, in writing, provisions for key decisions like how property owned by each of person prior to the marriage is to be divided, how property acquired during the marriage is to be divided, how income and earnings are treated during the marriage or payment of expenses for children and stepchildren.

No one wants to think about a potential divorce when beginning a new life together. But the fact remains that about half of all marriages end in divorce, which can be a financial nightmare or the end for a farming operation.

The prenup process centers on financial transparency, Rincker says, which is why she’s a big proponent for farm families.

“Sometimes I’m surprised when two people come in my office and they’re about ready to get married in a month or two, and they have no idea how much the other person makes in a year,” she says. “They have no idea their assets and liabilities. I think there’s something to be said for forcing people get financially naked, so to speak, and to really talk about those tough issues.”

Sabra Sasson, an attorney who specializes in premarital and matrimonial law and is with New York City-based Sabra Law Group , agrees.

“I really view a prenuptial agreement as insurance against divorce,” Sasson says. “Because if people get more comfortable talking about money and these various issues that are really challenging and uncomfortable, they have a better way of communicating with each other during their marriage.”

Marriage is a financial arrangement, Sasson notes, which she knows is hard for people to accept. “But it becomes really evident when that relationship doesn’t work out—it becomes all about money.”

One key component of a prenup is defining what is marital property and what is separate or non-marital property. Basically, non-marital property is what was owned separately before marriage and anything acquired after marriage is marital property.

This is especially important for farmers as most operations comingle assets. For instance, the farm may have started with nonmarital property (land, machinery or livestock owned by one party prior to the marriage). But over time, the farm may grow and include assets purchased during the marriage. This can be even more complicated for operations with multiple family members or non-related partners.

“A prenuptial agreement is a great way to protect the family agricultural business, and to ensure that it’s not subject to equitable distribution,” Sasson says. “When you talk about it with your life partner, there may be other ways that you can provide for your spouse that doesn’t include giving them a piece of the farm or equity in the business.”

For instance, if your spouse knows nothing about running the farm operation you can create provisions for your spouse to be financially protected, as other partners purchase his or her share.

“Then, the business is protected and can continue operating without being caught up in litigation,” Sasson says.

Start the prenup process early. “I wish people would come to me as soon as they are engaged,” Sasson says. “These are really hard issues to discuss, so I like a three-month timeframe, as I think that’s a fair amount of time to get familiar and get comfortable talking about the numbers. A prenuptial agreement makes people talk about this while they are in love and are more likely to treat each other in fairness.”

Even though laws can change, Sasson says, prenups are one of the best ways to protect both parties entering into a marriage. Sasson and Rincker recommend finding an attorney to specializes in marital law and understands agriculture, since farm assets create specific challenges and opportunities.

“A lot of time people hear that prenups are only for the rich and famous,” Sasson says. “Arguably, I think they are for anybody these days.”

“Prenups are not taboo—to the contrary,” Rincker adds. “I believe it is one of the most intelligent and responsible things that couples can do. It gives them autonomy by putting the law in their own plans.”

Want to learn more about prenuptial agreements? Watch this video podcast with Rincker and Sasson:

You can learn more about agricultural law issues on Rincker’s Ag Law Today podcast , which is available online or wherever you listen to podcasts.

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Thu, 19 Nov 2020 03:25:45 GMT

Kubota Adds to Diesel RTV X-Series

Kubota Tractor Corporation’s all-new RTV X-Series is the next generation lineup of diesel work utility vehicles.

Kubota’s powerful new lineup includes the RTV-X900, a comfortable and versatile model for a wide variety of jobs; the RTV-X1120D, a deluxe model that steps up in power and amenities; and the RTV-X1100C, which offers a best-in-class factory-installed, fully-enclosed unibody cab with a powerful heating and air conditioning system. The muscle in the machines are Kubota-built diesel engines and Variable Hydraulic Transmissions (VHT-X).

Kubota RTV-X900 - The RTV-X900 has a powerful 21.6 hp diesel engine, standard four-wheel drive and standard hydraulic power steering for exceptional comfort and control. The two-speed in-line shift allows the operator to maintain better control and shift less often, with two forward speeds - high and low - as well as neutral and reverse. The steel-structured frame insulates the operator from outside noise and vibrations, and front and rear independent suspension offers a smoother ride. With 2" hitch receivers at the front and back, the X1120D has a 1,300 lb.-towing capacity. The heavy-duty, hydraulic-lift steel cargo dumping box can carry up to a half ton (1,102 lbs.) and comes with a factory-option, spray-on bed liner to protect the cargo bed from dirt and damage.

Kubota RTV-X1120D - From its proven 24.8 hp diesel engine and higher ground speed of up to 29 mph to its blue-tinted halogen headlights and polished alloy wheels, the RTV-X1120D is a deluxe model that offers a step up in power, comfort and style. The responsive hydrostatic power steering offers more personalized comfort with a tilt-feature.

Kubota RTV-X1100C - Completing the lineup is the all-weather RTV-X1100C, offering a factory-installed, fully-enclosed unibody cab witha powerful heating and air conditioning system. The lightweight unit has two large roll-down windows, is nearly airtight, low noise and is virtually rattle-free for a smoother, quieter ride that raises the bar on comfort, convenience and performance. The X1100C is also pre-wired with an antenna and two speakers for easy and efficient installation of an optional radio. Engineered for safety, the X1100C cab, as well as all other RTV X-Series models, meets SAE J2194 and OSHA 1928 ROPS standards.

These models are available in classic Kubota Orange or Realtree AP Camo, Kubota will continue to offer the RTV400, RTV500 and RTV1140CPX in 2014. To learn more about Kubota-s full RTV lineup, or to find a Kubota dealer near you, visit www.kubota.com .

An After-Death Checklist: Tips for Executors

Thu, 19 Nov 2020 03:14:07 GMT

The days following a loved one’s death are emotional and stressful. If you are the executor or trustee for that person, those days are also filled with legal, financial and business responsibilities. Avoid being overwhelmed by knowing exactly who to contact and what steps to take.

“A personal representative or trustee should not go it alone,” says Liza Moore, attorney with Foster Swift Collins & Smith in Lansing, Mich. “An attorney will help you understand and comply with the deadlines and requirements that apply in your state.”

When farmers die, you must take certain steps. Farms are ongoing businesses with many contractual obligations, such as contracts with elevators, land leases and operating loans, Moore says. Address any agreements the farmer had at the time of death.

Lean on trusted professionals to help with this process, suggests Cari Rincker, principal attorney with Rincker Law in Champaign, Ill. “Even if you’re well organized and knowledgeable about probate and estate law, it’s surprisingly hard to anticipate what can go wrong.”

For example, an executor who makes distributions from an estate too soon can get into trouble. Seek professional counsel to avoid even the appearance of impropriety when handling an estate, Rincker says.

While serving as an executor or trustee is stressful and time-consuming (plan on at least a year to settle an estate), it’s also a good catalyst to get your own affairs in order.

“No one wants to talk about or plan for death,” Moore says. “But proper estate and succession planning are really about planning for life—ensuring loved ones are cared for and the farm lives on and thrives in the next generation.”

Dust off your estate planning documents and ensure everything is up-to-date and relevant. Your future executor will thank you.

The Steps To Take

Settling an estate includes many tasks and processes. Some duties require a quick turnaround, so immediately contact your lawyer, says Cari Rincker, principal attorney with Rincker Law. To help work through the crucial steps, she provides this checklist.

Secure the deceased’s personal property (vehicle, home, business, etc.).
Notify the post office.
Request at least 20 copies of the death certificate.
Notify the Social Security office.
Take care of any Medicare details.
Contact landlords or tenants.
Notify your local USDA or Farm Service Agency office to check on government payments and programs.
Stop health insurance and notify relevant insurance companies. Terminate any unneeded policies. You might need to wait until after you’ve “formally” taken over the estate, but you can often start the paperwork.
Cancel the deceased’s driver’s license, passport, voter’s registration and club memberships.
Close out email and social media accounts and any other websites.
Contact your tax preparer.
Schedule a meeting with a qualified probate and trust administration attorney. Here’s what information you need to gather:
- The deceased’s will and trust.
- A list of the deceased’s bills and debts.
- A list of the deceased’s financial advisers, insurance agent, tax professional and other advisers.
- A list of the deceased’s surviving family members, including their contact information. Even if they’re not named in the trust, the attorney will need to know about everyone in the family.

Don’t delay in creating or updating your succession plan. Join leading experts at the Legacy Project Conference, Jan. 14–15 in Chicago. Register at TPSummit.com