The Future of Your Farm: Estate Planning and Agriculture
It is important to plan for your future, no matter what business you are involved in. However, when it comes to agriculture, estate planning is of the utmost importance. Like most Americans, many farmers haven't spent time planning for the future of their land and their business. Yet the US farming and food system contributes almost $1 trillion to our national economy each year. According to one source, agriculture provides more than 13 percent of our nation's gross domestic product. As well, they employ about 17 percent of the total labor force in the United States.
America produces about 86 percent of their fruits and vegetables in urban areas that are threatened by development. This means that if estates are not carefully planned out, the farms may fall to developers who will use the land for construction rather than to grow produce. In addition to produce, cattle ranches and other livestock farms are also important. Every state in the US has a cattle industry, and the milk and meat produced from these animals is essential to American economic growth. Farmers and ranchers are the stewards of America's natural resources. They have the duty to protect their land and the resources on the property from being demolished or destroyed.
According to one estate planning press release, small farms and ranches own about 52 percent of all the land in America that is used for agriculture. The farms and ranches are incredibly valuable when it comes to protecting the future of American exports. Agriculture even has an environmental impact on our nation. The plants help to control climate and provide groundwater recharges. All of these important functions of a farm develop as the soil matures over the years. Farms can't be placed anywhere, they must be in places where the produce or the animals can flourish without being hampered by the weather or another issue. Sadly, America still loses about 125 acres of farm and ranch land to development every single hour.
Almost all of the small ranches and farms that are so essential to America are family-owned. They are also operated as a family-business. In most cases, the property and the work load is passed on from generation to generation. Allegedly, more than 37,500 cattle ranchers are running businesses that have been in the family for over 100 years. Yet these generational businesses can be demolished in an instant. All it takes is an owner without a proper estate plan. Families who don't plan for the future may lose their assets to the state in order to satisfy estate tax liabilities.
Another risk to farms and ranches is the absence of a willing heir in the future. US farmland organizations estimate that about 70 percent of all agriculture landlords will have to will their business to a new heir within the next 20 years. But if there is not a man or woman willing to run the farm, then the land might be lost. Heirs may sell off the land without a thought of the effect that this will have on America as a whole. It is essential that farmers talk to their heirs about the responsibility of running a farm, and will the land to someone who is up to the task. Over half of all agricultural landlords are over 65. If you are in this category, then you should start planning for the future of your farm right now. It is very important that you carefully locate a trustworthy successor who can continue your farm or ranch business. Contact help today and get started.
Posted on Jun 28, 2012 7:45am PDT