Household farms and ranches face a few of the exact same estate planning obstacles as any other company; nevertheless, there are some elements of estate planning that are special to the household farm or cattle ranch. If you own a family farm or cattle ranch, and plan to pass it down to future generations, cautious estate planning is vital to prevent losing your farm or cattle ranch to estate taxes.
A farm or cattle ranch is typically at threat for losing assets upon the death of the owner since while the estate may really consist of important possessions, such as land, it is also frequently heavily in debt. The end outcome might be that the estate is subject to estate taxes, yet there are no liquid possessions available to pay the taxes, forcing the sale of estate properties. The following estate planning tools may assist you move a few of your farm or ranch assets on to future generations prior to your death which will help avoid estate taxes.
Gifting: Benefiting from the annual present tax exemption and lifetime exclusion can assist hand down the farm or cattle ranch. Simply ensure you know the current life time exclusion amount so that you do not sustain present taxes.