January 2018 Agricultural Law News
January 24, 2018
Remember the old saying “failing to plan is planning to fail”? Here are five reasons why you need a good succession plan now.
1. Family Relationships. Ensure family members know where they stand with the future of the farm by eliminating uncertainty of asset ownership, now and in the future. Allow the next generation to begin investing (their time and/or money) in the family business with confidence by knowing how the farm will transition down the road.
2. Tax Savings. Minimize income, gift, and estate tax liabilities by planning. Navigate PA 116, the Michigan real property transfer tax, and real property uncapping issues effectively.
3. Risk Management through Business Entity Selection. Determine whether forming a corporation, a partnership, or a limited liability company best suits your situation to minimize risks and taxes.
4. Maximize Productivity. Evaluate your situation with trusted advisors to develop strategies to meet the future income needs of the older generation while balancing the financial capacity of the younger generation. Begin formally sharing business decisions with the younger generation to help develop their management skills well before inheritance time.
5. Peace of Mind. Too many people know they need a succession plan, but, for many reasons, keep putting it off for some time in the future. Get a good plan in place now, so that you and your family can go forward to your future goals with peace of mind and confidence.
Talk to an attorney that understands the unique challenges that face agribusinesses and can help you get a plan in place that will meet your needs. If you have questions regarding succession plans, contact Liza Moore at 517.371.8281.
This material has been updated from an original article published on July 18, 2014 for the Foster Swift Agricultural Law Update.