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CENTRAL ILLINOIS (WCIA) — University of Illinois ag economist Gary Schnitkey says higher land values not only draw higher estate taxes, but create challenges in handing down the farm to the next generation.
One of the things these high land values does is causes it hard to be equitable to the generation that is going to continue farming, and probably receive that farmland, and making it up with other assets that have not appreciated for the non-farming heirs is a big deal,” Schnitkey said. “An 80-acre farm is worth over a million dollars in central Illinois and how do we be equitable when passing it on to the next generation.
Stu: So what should people do to start that planning, other than right now?
“One of the things is begin to think about it, and not leave it to the end, but the point is to be fair and communicate, so if we have one generation that is going to receive the farm, for example and another that won’t, we make those wishes known while the older generation is around,” Schnitkey said. “The other thing to think about is if you are transferring the asset, make sure, to the next generation that we make that transfer as simple as possible for the next generation to manage and by that to keep plots of land separate from one another so that individuals don’t have to make decisions with the consent of everyone else, and just think through those things, and it’s a matter of thinking through those things and communicating.”
Stu: Is there an easy way to do it all?
There’s not an easy way, you just have to make decisions, and think it through, and its important to communicate those desires sooner rather than later,” Schnitkey said.
That’s our report from the farm, I’m Stu Ellis with WCIA-3, your local news later.