In increasing numbers, it seems couples that have built their life around the family farm in America are facing a new dilemma as they reach retirement age. In many cases the farm is producing no more than 2-3% of its market value in an income stream. In today’s society, the children often have little or no interest in carrying on the farming tradition of Mom and Dad. The prospect of relying on this asset for significant retirement income while having to pay someone else to run the farm is not an attractive one.
Selling the farm outright is less than ideal for two reasons. First, the couple would like to continue to live in the farm residence. Second, the farm represents the vast majority of the couple’s estate and, therefore, their children’s inheritance. The tax consequences of a sale would drastically reduce estate value around which they have built retirement plans, as well as the inheritance they wish to leave for children.
Is it possible for the couple to find a way to increase their retirement income (perhaps without even having to move out of the farm residence!) and still provide an inheritance for their children?
Thankfully, the answer is yes. In fact, a number of options are available for the couple’s consideration. The Foundation for Community Care offers a detailed look at how careful planning can help you achieve your objectives for retirement as well as for family.
The Right To Live In The Residence
Many families find themselves in a position to retire from farming. It is not unusual for many in this position to dread the idea of moving from the residence they have occupied for most of their adult lives. In fact, many couples are enthusiastic about a plan that allows them to deed the homestead to charity, receive an immediate charitable income tax deduction, and remain in the home for the rest of their lives.
A Springboard To The Golden Years
In spite of the misgivings that surely come in the midst of a decision to sell the farm after investing a lifetime in its productivity, this can mark the beginning of an exciting new era. Thanks to a number of planning options that are at your fingertips, the value represented by the farm can represent significant value in the retirement years.
The fact is that U.S. tax laws provide for a wide variety of planning options designed to help individuals and families make specific plans that achieve specific objectives.
If you would like to see a personalized example of how this option could deliver immediate tax benefits, and make a dramatic philanthropic statement, please call or write the Foundation for Community Care, Attention Staci Miller, 221 2nd St. NW, Sidney, MT 59270, 406-488-2273 or send us an email at [email protected].
This information is offered as an educational service. There is no cost or obligation, and any communication is treated in complete confidence. This information is not intended to replace the counsel of personal professional advisors.
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