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An Old Will Creates a Future Mess

Submitted by T.J.:

We are in a real mess. My husband, Joe, was admitted last month into a memory care center for advanced Alzheimer’s. We have good long-term care policies. Our farm operation has been in really good hands since our son, Alan, and his wife have farmed with us for 34 years. Actually, with Joe’s health deteriorating, they’ve done all the management and most of the labor for the past 20-plus years. Joe has always been proud of Alan’s work and grateful he came back to work with us and grow the farm. A number of times, I heard Joe promise Alan, “When I’m gone, the farm will be yours. I’ll make sure of it. You’ve made it what it is today.”
   Here’s the problem: Joe and I never updated our very old wills. Currently his estate is divided half to me and the remaining half equally to our four children. I also have additional income away from the farm. Recently, two of our children reminded me there can be no changes made to Joe’s will because of his mental status. They approached Alan telling him they’d like the farm appraised now so they have an idea of their inheritance. That was the first time Alan became aware of the terms. All hell broke loose. How can I fix this?

                         

Solution:

First, I am sorry you are coping with Joe’s Alzheimer’s. I hope you’ve sought out a support group of others experiencing the same journey. Second, you’re well aware of the expense of care in a memory unit, so continue to monitor and set aside personal money for expenses not covered by the long-term care policy.

Now, the farm. Please know I am not an attorney. You must seek immediate advice from one you trust. You first need to decide if you want to honor Joe’s promise and if it is also your intent that Alan and his wife continue in management and ownership of the business they have worked decades to build for you and for them. 

If the answer is yes, then run to an attorney. I believe your two children are correct in that Joe’s will can’t be changed, but your will can. If you do not need farm income/equity for your lifestyle and living, you can gift your current half of farm ownership to Alan and his wife now for earned sweat equity, and when Joe passes, you can will or gift your half of his estate to Alan, as well. Be mindful of tax ramifications. It would be best if Alan secures finances to buy out his three siblings if they wish to sell their portion of Joe’s estate to him or at auction. This would assure 75% of the farm assets remain in Alan’s control, plus one quarter of the children’s distribution. 

There is a big BUT: You can choose other alternatives, different percentages, or purchasing agreements. A good estate attorney will have options. Also, if you’ve not utilized your other nonfarm assets, you might pass those to your three nonfarming children.

Once you’ve met with your attorney and accountant and signed the documents, let your decision and distribution process be known to all your children. You can do this at the attorney’s office so he or she can explain the details. Your children may not like it, but maybe the nonfarming children have built their lives and secured their benefits, income, and retirement away from the farm while Alan and his wife were taking care of you and growing the business. Alan and his wife might then also have the option to continue in agriculture with great risk and, hopefully, great reward. 

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