Our firm had the pleasure and opportunity this last week to have a booth and attend the North Dakota Ag Expo in Minot, North Dakota. As an estate planning lawyer, I know the lines between estate planning, business succession, and farming operations can be blurred at best. We wanted to have a presence at the ag expo to get a feel for how some of the state’s ag producers were addressing the need for farming succession plans.
This probably won’t come as a shock to anyone in North Dakota, but ag producers are just like many other people in the state. One such similarity is that many of the ag producers we spoke with did not have an estate or business succession plan in place. As with non-producers, this should not be the case.
The Importance Of An Estate Or Business Succession Plan
While everyone should have an estate plan in place, ag producers especially need to plan should unfortunate circumstances strike the producer or his/her operation. Farming operations in North Dakota have been, and continue to be largely multi-generational operations. In addition, many farming operations tend to have one or two people who are in charge of all of the important information about the business. While there can be a tremendous amount of pride in having your family carry on the ag operation, the mixing of family and business always, always, always needs to be planned properly. In addition, farming operations need to have a plan in place to ensure decision making power is passed to someone as fast and smoothly as possible.
As mentioned above, the mixing of family and business is always a tricky task. The producer has uncertainty about the next generation’s ability to run the farming operation. The younger generation has preconceived notions of when and how the farming operation should be passed down. After all, many of the younger generations have been instilled with the pride of working on the family farm and want to instill that same pride in the next generation. This is where it is a wonderful idea to get an International Farm Transition Network (“IFTN”) coordinator to aid in the planning process as well.
An IFTN coordinator can get the present and future ag producers to a sort of round table discussion to work out the major ideas and themes of the farming succession plan. In addition, the use of a coordinator will allow everyone to voice their concerns, ideas, preconceived notions, and concerns. Once the coordinator has helped the producers to reach a high-level plan, then an attorney can get involved and button down the details of the entire succession plan.
Depending on the complexity of the farming operation, a successful succession plan may be a simple task. Nonetheless, you owe it to yourself and to the next generation to start the succession planning process today.
If you have questions regarding the topic of this article, or for assistance with estate planning, succession planning, or if you want to seek the help of an IFTN certified coordinator, please call the Estate Planning Team at 701-297-2890 or email us below.
The information contained in this article and on this website is for informational purposes only and not for the purpose of providing legal advice. You should contact an attorney to obtain advice with respect to your particular set of circumstances.