Even young farmers can use an estate plan
In the busy days of dairy farming, transition planning is an easy topic to kick down the road to tackle later on — there’s plenty of time left to figure that out, right? Similarly, estate plans or even personal wills that are related to the continuation of the farm business might get put off with the rationale that they’re not necessary yet.
Those thoughts, however, don’t change the fact that farming is one of the most dangerous industries for workplace injuries, and accidents unfortunately happen every day. Younger farmers looking to become future managers and owners may be especially likely to be working in this environment with no plan for their estate should something happen. No matter the amount of assets you may have, it is a good idea for young farmers to take a quick review of their plans and have a few key documents in place, advised attorney Kelly Wilfert.
First are three “in case of emergency” items, said the Wisconsin-based agricultural lawyer. Have both a financial and health care power of attorney in place so that in case you are unable to make decisions for yourself, someone or multiple people you have appointed can. These documents may be set up to be effective immediately or go into effect at the time of a disability or incapacitation, Wilfert shared.
Similarly, a HIPAA authorization will allow your health care provider to share your medical information with the trusted person(s) you have named. “Without these documents, following an accident, your family may need to go to the court to request a guardian be appointed to make these decisions,” wrote Wilfert. That process can make an already challenging time more difficult.
The final item Wilfert recommends young farmers have is a basic will or trust. When putting a will together, consider who your estate would be transferred to if you had no plan. Is this who you want to control your assets, or who should control them? The second question may be especially important if a family business is in the process of transitioning and moving assets around.
You may also want to consider if you’re comfortable with your estate going through a public probate process and how any tax implications would be dealt with. Of course, if you have children, a will would need to include guidelines for their care as well as any assets they may receive.
Creating an estate plan is likely not at the top of many young farmers’ to do lists, but having one in place can provide peace of mind for the rest of your family. Start small and allow the plan to grow and evolve as you and the business change over time, Wilfert advised.
Katelyn Allen, Associate Editor
August 8, 2022