Legal Tools and Relationships for Farm Succession

If you’re ready to dive into the legal tools to help you make a plan for passing the farm business on this course is for you. The lessons will help you create a farm succession plan whether you pass the farm on to a family member or another non-related farmer you know (or hope to find!).

This is an approximately 3-hour self-paced course that will help you create a farm succession plan whether you pass the farm on to a family member or another non-related farmer you know (or hope to find!). We cover wills and trusts, Medicaid, and using business agreements to organize succession. This course addresses many potential succession plans.

Course objectives

Upon completion of this course, you will understand the core function of:

• A living trust, revocable trust, and irrevocable trust in carrying out a farm succession plan.
• A business structure governance document (operating agreement, bylaws, etc) in facilitating a farm succession plan.
• Tax/legal considerations of a farm succession plan including estate tax, gift tax, capital gains tax, and Medicare eligibility.
• Selecting professionals in creating a solid farm succession plan from among: attorney, insurance agent, accountant/tax planner, and financial planning professional.

As a result, you will determine which of the above legal mechanisms you feel may be most appropriate to achieve the specific goals you’ve identified for your succession plan.

What is included in this course?

This course includes 5 lessons featuring illuminating video presentations, insightful readings, reflective quizzes, and action-planning exercises. At the end of the course, we include further resources for moving forward. Access the course materials at any time using your active Farm Commons member account.

Here’s an overview of the lessons you’ll work through:

Lesson 1: Getting Started

• Monetary Value – Can the farm provide the retiring farmer and the aspiring farmer with sufficient resources during the transition?
• Available Assets – What financial resources are needed to support the retiring farmer for the rest of their days?
• Relationships – What relationship-based assets does your business have? Relationship with a Successor
• Goals and Values – What values are attached to the farm?
• Which legal tool fits your succession goals?

Lesson 2: Wills and Trusts

• The Role of a Written Will
• The Role of Trusts
• Types of Trusts
• Which Trust Fits Your Goals?

Lesson 3: Structuring a Business Entity to Meet Succession Needs

• Structuring a Governance Document to Allow for Succession
• The Basics of Business Valuation and Transfer
• Four Essential Strategies

Lesson 4: Tax Considerations

• Estate Tax Impacts
• Anticipated Changes to Estate Taxes
• The Gift Tax
• Income Tax Planning (Basis Planning)

Lesson 5: Building Your Team of Advisors

• Goals as Guides
• Insuring Your Succession Plans
• Supporting Financial Statements and Taxes
• Optimizing Attorney Services
• 3 tips for establishing relationships with succession advisors
• Checklist for Selecting Succession Advisors

Next Steps

• Tips for Moving Forward
• Make Your Action Plan

This course is suitable for farmers and ranchers with any business experience. However, those with at least one year of experience who are able to conduct an assessment of their business and work through tangible assignments to improve current risk management systems will benefit most from this course.

Course requirements

• Active Farm Commons membership
• Broadband internet connection with a minimum speed of 5Mbps (recommended)
• Desktop browser: Chrome, Firefox, Safari, Microsoft Edge
• Mobile browser: iOS Safari, Chrome, Samsung Internet

Note: The course platform is not supported on Internet Explorer, Chromium, and Linux web browsers. You will see an error message if attempting to access the course on these browsers.