For all farm and ranch businesses, there will come a time when the operator(s) need to retire. As this time approaches, farmers and ranchers often ask, what tools are available to producers who want their business to continue after retirement and, eventually, after they pass? This question is about farm succession — the business succeeding to the next generation of owners and operators. Creating a succession plan is a big and important endeavor that requires the retiring farmer to spend significant time and energy on planning, strategizing and collaborating with business partners, family members, professionals (such as attorneys, tax professionals, and meditators), and the aspiring farmer(s).
As with any big endeavor, it’ helpful to take it one step at a time. Get started with basic guidance on the legal process of transitioning your farm business and land to new owners by reading our free Farm Succession Planning Basics. If you’re on the go, tune into our podcast episode featuring Martha McFarland of Hawkeye Buffalo and Cattle Ranch in Iowa as she shares her story of accessing land through a family farm transition: Episode 61: Farm Transitions with Farmer Martha. Because every farm will have a unique succession plan and journey, we recommend also watching A Century-Old Farm Prepares for Changing Seasons where Adrienne Ploss of Hickory Hurst Farm in New York shares her story of succession planning for three generations of her family’s 100-year-old farm.
It’s important to state the reality here: Farm succession isn’t easy, and success is less common than we would like. One primary reason that farm transitions have a high failure rate is that the investments required to support a successful succession project—from relationship building to attorney’s fees—need a fair amount of assets. When we say assets, we do not mean only money! But, we do believe that the process of farm succession is a project for stable farm businesses that can survive a transition in ownership and into the future.
If you’re ready to dive into the legal tools to help you make a plan for passing the farm business on, read our in-depth guide Wills, Trusts and Business Structures for Farm Succession. The pointers in this guide will help whether you pass the farm on to a family member or another non-related farmer you know (or hope to find!). It covers topics from wills to trusts, Medicaid, and using business agreements to organize succession. This guide will address many potential succession plans!
For an interactive learning experience on your own schedule, take our self-paced course Legal Tools and Relationships for Farm Succession.
