DTN/The Progressive Farmer In-Depth


Senior Partners

Keeping your farm and your family intact for another generation is a major challenge for today's capital-intensive farm businesses. Successors need to grow into new roles; parents need time balancing what's fair to on-farm and off-farm heirs. DTN's on-going Senior Partners series examines the financial, legal and emotional hurdles families face as they transition farm ownership from the senior to junior partners.

Inside You'll Find...

Why Seller Financing Fits the Bill - Except for family sales, seller financing virtually vanished after the farm crisis of the 1980s when farmland values burst and many buyers walked away from their contracts, returning title to the original owners. Now even arm's length installment sales should become more popular due to recent tax law changes and the current interest rate environment. (July 30, 2015)

Carve a Niche for Next Generation - Iowan Dave Lubben formalizes an apprenticeship program for his three would-be successors. (May 28, 2015)

Reward Your Hometown Team - Donating farmland to a community foundation or donor-advised fund can help rebuild rural America, advocates say. Here's how (March 30, 2015)

A Will to Save Main Street - Think how rural communities could rejuvenate if farmland rents stayed local rather than flowing to out-of-state heirs. That's why some farmland owners want their hometowns to inherit at least part of their land. (March 27, 2015)

Hire a Quarterback for Your Estate Plan - At-your-service consultants help you walk through estate planning from start to finish. (December 19, 2014)

What Farm Widows Wished They Knew - Farm accidents can strike at any age. Good farm advisers and documentation of what couples own, farm lease terms and business roles after a partner's death can ease the grief. (July 18, 2014)

Share Your Good Fortune - Donor-advised funds promote charitable giving while teaching family values. They work especially well as a tax tool for those with fluctuating farm incomes. (April 4, 2014)

Take Stock of Your Buy-Sell - There's more than one formula for valuing stock in a family business. Just don't wait for death, divorce or an imminent departure to set your terms. (January 24, 2014)

Tax Hell on Earth - If you're unlucky enough to die in any of these 13 high-tax states, your estate faces tax purgatory. That means you need to activate your estate plans while you're still young and healthy. (November 8, 2013)

Sometimes Minority Rules - A landmark Iowa Supreme Court ruling forces on-farm operators to play fair with minority partners. That precedent means off-farm heirs may need regular dividends and farmland values close to market prices when they exit.

Money-Saving Ideas for Small Estates - Not everyone owns a super-sized estate. Still, you need to take some simple steps now to minimize probate costs at death.

Retire With a Passport - Aggies share their expertise and rediscover purpose as overseas Farmer-to-Farmer volunteers. It's the kind of second career that can make room for junior back at the home farm.

Avoid the Land Trap - Digging highly appreciated land out of a C-corporation requires patience but can prevent double taxation. Give yourself a 10-year exit strategy.

The Farmer's Apprentice - Ben Hendrix was born to farm. But his father's prerequisites for a management job in the family business meant two college degrees, a policy banning a return for at least five years and professional tutors to fill in any knowledge gaps. June 24, 2013

From Here to Eternity - For sentimental or practical reasons, some owners want their farmland to stay in family hands for generations to come. Sharing family stories builds commitment, but buy-sell agreements can impose disincentives to liquidate. May 10, 2013

Outsource Your Successor - Less than one out of every three farmers has designated a successor, land grant university surveys find. Dairy farmers Lloyd and Daphne Holterman solved the problem by partnering outside the family and instituting a 10-year employee buyout. April 19, 2013

Charity Makes Career Exits Less Taxing - Retiring farmers can owe IRS 40% or more on assets they own after a lifetime of hard labor. Consider a Charitable Remainder Trust to lighten that load and reward good works in your golden years. March 8, 2013

Give and You Shall Receive - Charitable gift annuities let you reward your favorite charities while you're alive -- and receive a small income stream back in return. It can be a win-win in your retirement years. February 11, 2013

Jump Start the Conversation - It's a Dickens of a time to talk with family members about farm estate plans, but here are five tips to help you broach the subject. December 24, 2012

Remember the Second Estate Tax - Sixteen states impose their own death tax on top of your federal estate tax bill. That can add hundreds of thousands of dollars to the cost of transitioning ownership between generations. November 30, 2012

The Bank of Mom and Dad - Rock-bottom interest rates give the senior generation extra incentive to make loans to the next farmer in the family. It saves borrowers interest and can shave the size of the retiring farmers' estates. July 31, 2012

With Buyouts, Insurance Isn't Enough - Insurance can't keep pace with today's high-priced farm assets, so on-farm operators need flexible terms after a death, disability or retirement. Just don't penalize exiting partners too severely. (June 4, 2012)

Pre-Plan a Partnership Split - Buy-sell agreements offer harmony when partnerships hit discords, disability, death or retirement. (June 1, 2012)

Keeping a Brother's Trust - A family's timely decision to plan for the future secures the operation when tragedy strikes. (May 3, 2012)

Heritage is the Tie That Binds - Before you launch a transition with legal and tax formalities, convey family values to your heirs. Some farm families lay the groundwork for family harmony while their children are teenagers. (April 4, 2012)

Get Dad a Second Career
- Training began early for next-generation farmer Adam Hill. Now he's ready for a job promotion. (March 6, 2012)

Devise Your Exit Strategy - Too many farm patriarchs err by ruling with an iron grip until death or disability, leaving their successors no chance to build experience until late in their lives. Advisers are helping this North Dakota couple step aside while they're in their prime. (March 2, 2012)

Edit Your Estate Plan - Unknown tax laws, fluctuating family situations and windfalls from farmland keep estate plans in flux during your lifespan. Make sure your plan evolves as you do. (January 23, 2012)

Freeze Your Estate Valuation - Farmland is appreciating faster now than in the 1970s, pushing even modest-sized farmland owners into estate tax trouble. Consider a trust that freezes land values now while retaining control of the farm during your lifetime. (December 23, 2011)

Play Santa With Your Estate - Congress gives you a reason to be generous with your heirs this Christmas: Today's $5 million estate tax exemption might not last. (December 5, 2011)

Land Owners Share the Wealth - Dust doesn't need to return to dust. Farm owners are donating land to their communities in their wills. And those bequests aim to reverse the decline of rural towns. (October 20, 2011)

Hire Your Heir Apparent - Like many farmers in their 60s, Indiana's Don Villwock doesn't have a blood relative who wants to take over his farm. Instead, he's groomed a promising young neighbor to be his successor. (September 14, 2011)

Keep Off-Farm Partners in the Loop - You don't have to lose your talent pool when your offspring choose the city life. The Wyss family of Indiana forged bonds in the 1980s that kept all four of their offspring committed to the farm's success. (August 22, 2011)

Five Steps for a Successful Return to the Farm
- It takes attitude and aptitude to integrate into an existing farm business. (July 6, 2011)

Make Room for the Farmer's Daughter - Patient and encouraging parents readied these young women for a career in the family business. (July 5, 2011)

Fine Tune Your Life Insurance Coverage - Once you decide what and how much life insurance you can afford, consider four important questions. (May 17, 2011)

Cash Consoles When Losing a Partner - Estate taxes aren't the only worry after a partner's death. Farms need quick cash from life insurance to pay off debt and keep peace in the family. Follow DTN's consumer guide to get the best buy for your insurance dollars. (May 16, 2011)

Land Price Bump Strains Family Buyouts - Runaway land values are creating a high hurdle for family farm successors. With farmland approaching $8,000 to $10,000 an acre, they can't afford to buy out a partner's widow, let alone siblings and cousins. (April 21, 2011)

No Free Pass on Estate Planning - Farm families often make $100,000-and-up oversights when transferring the farm business. Many of those costly mistakes could be prevented with better planning, says CPA Nick Houle. Here's a checklist of five big estate tax savers to consider. (March 18, 2011)

Treat Farming Cousins with TLC - Most family businesses fold by the third generation when cousins gain control. In this second in an occasional series on farms in transition, family business consultant Johnne Syverson outlines a 12-step process to boost success for the third generation. (Feb 22, 2011)

Boot Camp: How to Groom Replacements on the Farm - Four brothers raised 22 kids between them on their Colorado farm. Giving the cousins' generation the opportunity to join the business meant developing a formal training program and a plan to impart family values. (Feb. 18, 2011)

Give Farm Estates a Discount - Reduce farm estates values another $1 million with special use valuation. (May 14, 2010)

The ABCs of Trusts - Establish a plan for heirs by tapping some of these common trusts used in farm estates. (May 13, 2010)

How to Leave a Legacy - Trusts build the framework to keep her family's South Dakota farm intact for another generation, DTN's Susanne Stahl reports in this third of a series on estate planning. (May 13, 2010)

Don't Let Long-Term Care Disable a Farm - Long-term health care for yourself or elder partners could threaten your farm's viability. Consider long-term care insurance to lighten the load. (Feb. 26, 2010)

Five Steps to Launch a Farm Transition - Begin farm business transfers early to avoid tax or cash flow shocks, farm families say. Here are some starting points. (Feb. 25, 2010)