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Estate planning important for Oklahoma farmers

Aside from distributing their assets to their loved ones, many people use estate planning for other reasons, for example as a tool for long-term health care planning, to minimize probate, to provide for someone with special needs or to avoid estate taxes. The federal estate tax exemption for individuals is currently $5.5 million, so some may feel estate planning is unnecessary for the average person. However, Oklahoma farmers may not have the luxury of avoiding such preparations.

Farmers own millions of acres across the country, and those who earn their living from the land typically own 500 acres or more. Including the going value of farm land, farm equipment, fertilizer and seed, farmers may have millions of dollars in assets. However, many farmers earn only a middle-class income from their efforts, and that is only in years when prices are high and natural disasters are few.

Nevertheless, farmers are often subject to the estate tax because of the value of their assets. Handing down a farm through generations may mean families have to sell parcels of farm land just to pay the estate tax. This is not always easy; land may be difficult to sell and certainly carries no guarantee that the price will be right. More importantly, selling off one's land reduces the size of farmable property.

When facing the difficult choices necessary in estate planning, Oklahoma farmers have a lot at stake. There are options available to minimize the impact of the estate tax, and many farmers take advantage of these tools. An attorney can assist them in determining the best methods for efficiently managing their assets.

Source: USA Today, "Estate tax forces farmers to play defense", Zippy Duvall, Nov. 8, 2017

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