For the first time since 2020, the number of Americans with a will has declined, with only 32 percent of Americans having an estate plan in 2024, a six percent decline from last year. Having an estate plan for farmers and ranchers is especially important as it protects the future of the operation.
Dean Voskuhl with AARP in Oklahoma says there are three things to consider.
“First, develop and maintain a succession plan for ownership and management of the farm. Next, consider planning for retirement plan accounts and life insurance needs of the farm as a closely held business. You should also consider premarital agreements and protection of interests in the farm. As a bonus, consider digital assets, such as passwords and accounts that are critical to the farm operation.”
The main reasons people put off an estate plan is they either haven’t got to it yet or think they don’t have enough assets to leave to anyone.
“Neither is a great reason. Technology today means you can create a will online in less than an hour, and assets are only one part of the story. A heath care directive and a durable power of attorney are also important for your estate plan. The right paperwork can save your loved ones headaches and heartache, and give you peace of mind.”
Voskuhl adds there are a few changes in the tax code on the horizon to keep in mind as well.
“The first is the implementation of the Corporate Transparency Act, which will impose significant new reporting requirements on many small businesses. Second is the sunsetting of the increased estate and gift tax exemption amounts at the end of 2025. Unless Congress acts before January 1, 2026, the estate and gift tax exemptions will revert to where they were in 2017. With inflation adjustments, this will be approximately $7 million for individuals and $14 million for married couples.”
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