It’s not easy to discuss what to do with assets and properties upon a family member’s death. Discussion of the end of life is always unpleasant, and descendants may have different ideas over what to do with homes and businesses. Owners of farms, people who own family businesses, farms and other major sources of revenue, however, should plan early and regularly discuss the future of their estates.
One of the first things business owners should consider is obtaining a financial analysis of their assets and liabilities. A complete picture of where a farm or operation stands in the present, along with owner’s plans for the future, can help predict the complications that may apply to an estate upon the owner’s death.
A good reason to regularly review estates plans with farms and businesses is that there are frequent changes to federal and state tax codes. Some people even use state tax requirements as a factor when they decide where to retire. 2018 was the first year for a new federal tax law that elevated estate tax exemptions to $11.18 million per person. Spouses who combine exemptions, for example, can now entirely protect farms and businesses that are worth more than $11 million but less than $22 million from estate taxes. Those who don’t review their estate plans could miss out.
Lastly, and perhaps most importantly, anyone writing a will should talk to the people and organizations they plan to name as beneficiaries. Setting expectations and asking about an heir’s preferences can make it easier and less expensive for an executor to give assets to the intended parties.
Business owners looking to the future may need the help of an experienced attorney to properly write and execute their will and other estate plans. An attorney can also spot potential problems that aren’t adequately addressed in an existing will.