The value of your farm goes far beyond what the bank sees on paper. Your farm represents the input of long days of labor, sleepless nights of worry, and the hopes and dreams you’ve nurtured through the years. It also represents a huge chunk of your personal worth.
All of it is vulnerable, and it needs and deserves protection. We can help. At Huizenga Law, we work with farmers to develop the best plan to provide protection both now and in the days to come. We preserve legacies, because we understand the true value. We use a comprehensive approach to assist with this preservation.
Consider a Trust
While a trust often makes people think of rich families providing glamorous carefree lifestyles for a pack of spoiled relatives, the practical fact is that trusts can be used to benefit families in a wide variety of situations, and they are not reserved for the very wealthy.
A trust is an entity formed to hold property. Revocable living trusts are used to protect property owners in case of incapacity and to allow property to pass to loved ones after death without the need for probate. These trusts can provide a certain amount of protection for your farm, but you may want or need much more.
An irrevocable trust provides more protection because you cannot change terms or remove property once you create it. Property in the trust is managed by the trustee and is owned by the trust, so your creditors cannot reach property that you have transferred into the trust. It can be preserved for family members, or whoever you name as beneficiaries of the trust.
How an Irrevocable Trust Works
Putting assets in an irrevocable trust is like putting money in a locked box and handing the key to your older sister. You can’t get at the money anymore, but neither can anyone else, unless your older sister opens the box.
That “older sister” is your trustee. The trustee has a fiduciary duty to manage the property in the trust for the ultimate beneficiaries of the trust and to follow the instructions you’ve provided in the trust document. If you told your sister that she can only take money out of the box to give lunch money to your younger brother, then that’s all it can be used for. By creating the trust, you have assured that your younger brother will have lunch money for years to come, and that bullies can’t take it away from you even if they call you names, push you down, or take you to court.
A Conservation Easement Could Prevent Your Farm from Being Turned into a Strip Mall
If you want to ensure that the farm your grandfather started or the woods where you first went hunting will remain the same for future generations, you might want to consider creating a conservation easement. This will restrict the way the property can be used by future owners.
A conservation easement will not add to the financial value of the property—in fact, it could decrease the value considerably. What it does do for many, however, is provide peace of mind. It can ensure that farmland continues to be used as a farm or that undeveloped property remains the wilderness that you remember.
Talk to Us About the Ways We Can Protect Your Farm’s Legacy
We want to talk to you about the legacy you envision for your farm and how we can help make that a reality. No one knows what the future holds, but when you plan ahead, you can protect your assets and your family from a wide range of potential threats.
Schedule a consultation with Huizenga Law now to learn more about the ways we can secure your legacy.