Family farms and businesses can serve as a strong legacy, but you need a comprehensive succession plan to make sure these valuable assets pass to new owners. You should take steps to protect your farm or other family business when you wish to retire, if you become disabled, toward the end of your life, and after your death. An attorney can help.
Pearson Butler aids owners of farms and family businesses in Utah. The firm’s skilled business planning lawyers can help you understand the risks and take steps to limit the potential for loss so you can ensure the land and business will pass on to the next generation.
To discuss your needs and concerns, call (800) 265-2314 or contact the firm online. From offices in Bountiful, American Fork, and South Jordan, Pearson Butler serves all of Utah.
The Importance of Advanced Planning for Farms & Family Businesses
Farm owners throughout Utah have been faced with the devastating reality that they have to sell acreage after a death, due to estate taxes. Business owners have also faced the same fate, with no option but to sell shares of the company, business assets, or even the company itself.
This occurs because estate taxes can be assessed upon the death of the farm or business owner. Estate taxes are based on the value of property owned, and if the land or the company’s brand name are worth enough, the estate is heavily taxed. For business and farm owners whose wealth lies in the land or the company, there may not be cash available for estate taxes to be paid. Heirs will have no choice but to take a loan or to sell a part of the legacy that was left to them. This can be avoided with advanced planning designed to protect the farm and family business.
In addition to estate taxes, a farm or family business may be at risk due to:
- Mismanagement, if the owner is incapacitated and there is no plan or process in place to put a trusted individual in charge immediately.
- Mismanagement or uncertainty during the probate process, if the owner passes away and no steps have been taken to avoid probate.
- Irresponsible heirs who do not know how to manage the farm or company or who lose their inheritance to bankruptcy, divorce, or creditor claims.
- Nursing home costs or long-term medical expenses during the lifetime of the owner, if the farm or business counts as assets and prevents the owner from qualifying for Medicaid.
These are just a few possible threats to the value of a farm or family business—all of which can be addressed using the right estate planning tools.
Asset Protection & Succession Planning
There are different ways in which you can ensure your assets are kept safe in case of creditor claims, bankruptcy, nursing home bills, irresponsible heirs, and other threats.
There are also ways you can make certain your farm or business passes quickly to new owners. You need to get legal help deciding what legal tools are the right ones to use and making sure you comply with all legal formalities for taking advantage of those legal tools.
Possible options include:
- Medicaid planning
- Long-term care insurance and life insurance
- Power of attorney
Pearson Butler can help you to use these and other legal tools that will keep your farm or business safe when used effectively.
Take a proactive approach and protect your company and land. Call (800) 265-2314 today to speak with a seasoned Utah asset protection lawyer.