LegalX Blog is dedicated to bringing you the latest interesting news in law and providing you with legal resources that can help you make informed decisions.
Posts Tagged ‘agriculture’
Farmers Exemption from Estate Taxes
Wednesday, August 19th, 2009
U.S. House of Representatives (H.R. 3524) recently introduced a bill that will exempt family farms from federal estate taxes if the farms will stay with their respective families. The bill is called Family Farm Preservation Conservation Estate Tax Act. It was assigned to the Committee of House Ways and Means after being introduced by (D-Colo) Rep. John Salazar and (D-Napa) Rep. Mike Thompson.
According to Laurel Brown, the spokeswoman of Thompson, “The bill would defer estate taxes on conserved and agricultural land indefinitely, so long as it still remains in the family - this ensures that nobody would have to sell the land just to pay for the estate taxes. Then Murray said that “So many family farms have been struggling until now. This bill will encourage farms to remain in the family’s possession. There aren’t too many left.”
The law governing agricultural estate taxes is expiring next year. It’s expected to be replaced by another law in 2011 that would tax families blending the levels of 2001 and 2002. This level is hard for a lot of family farms, which are typically asset rich yet cash poor.
The new estate legislation was endorsed by 28 farm organizations including Western United Dairymen, Western Growers, California Association Winegrape Growers, and California Farm Bureau Federation.
Tags: agriculture, bill, estate, estate taxes, farms, federal, John Salazar, Laurel Brown, law, legislation, Mike Thompson, U.S. House of Representatives
Posted in Estate Planning | No Comments »
Estate Planning for Ranchers and Farmers
Monday, July 27th, 2009
When your family is engaged in agriculture, you have certain considerations to think of. You should consider if you will qualify for valuation deductions, divide the land into separate parcels, or make a charitable donation.
Practically, subdividing the land to give to children can raise both legal and practical questions. Legal questions include the minimum acreage requirements (whether it can be subdivided into parcels), deed of trusts (whether there are existing encumbrances that will affect future financing), and possible latent contaminations on lots that might become a responsibility to be cleaned up by your heirs.
Practical questions, on the other hand, include the dependability to water (or whether it’s feasible to subdivide the land), one part is locked (or access to roads), and distribution of electricity (or access to utilities). In addition, division of mineral rights and differing values should also be factored into your estate plan.
Finally, estate planning for ranchers and farmers (including vineyard owners) also involve business succession similar to closely held business families. This usually entails life insurance and buy-sell agreements. Moreover, predators, creditors, protecting children’s inheritance against divorce, Medi-Cal planning, and blended families’ estate planning may also be involved here.
Tags: agriculture, deed of trusts, Estate Planning, heirs, legal, parcels, practical
Posted in Estate Planning | No Comments »