The best of 'Can Their Problem be Solved?'
Every issue of Successful Farming magazine includes a reader question with an answer from one of our farm business and estate planning experts. The Can Their Problem be Solved? column is always full of sage and sound advice, but these 12 articles really struck a chord with readers.
Do they have what it takes?
A farmer nearing retirement has three children, one of whom farms with him. A son-in-law also helps sometimes. He worries neither has the managerial skills needed to run the business. Myron Friesen offers an inventive solution that will put them both to the test while the father is still around to guide them.
- READ MORE: Farm patriarch wonders if anyone in the next generation has what it takes to run the operation
This reader says family business meetings are a waste of time because one person takes over, and the others agree to an action but never follow through. While this is a common complaint, Jolene Brown says meetings are necessary to address labor, management and leadership, and ownership concerns.
- READ MORE: Are family business meetings necessary?
Fixing others' mistakes
After working through mistakes made by his parents, their attorney, and financial planner, this farmer and his wife now disagree on how to handle the farm's future. Their children are frustrated that they haven't created an estate plan. Myron Friesen says it's time to stop blaming others and figure out how to do the right thing.
Putting off estate planning
Potential tax law changes have this reader wondering if it would be best to wait until after the mid-term elections to do estate planning. Mark McLaughlin responds, "Look what’s happened while you were waiting: land prices have gone up, competition is stronger, and input costs are higher."
Trying not to play favorites
A farmer with three daughters has one key employee plus a son-in-law working on the farm. He wants to make sure they are taken care of, but doesn't want hard feelings between his daughters. Myron Friesen offers a warning about distributions to in-laws and shares ideas for keeping things fair.
A couple formed an irrevocable trust with life insurance years ago, thinking the proceeds would go to pay taxes. They also put all their land in an LLC and formed a C corporation for their farm, then gifted some ownership to their children to reduce their estate value. Now they want to make changes. Myron Friesen says they were given bad advice and offers guidance for fixing these issues.
How rental agreements affect land distribution
This reader rented land from his parents and neighbors, but when those people passed away, he struggled to continue the agreements with their heirs, including his own siblings. He wants to help his son avoid the same problem. Myron Friesen offers step-by-step advice for determining rent rates and figuring out how to negotiate with owners.
When Grandpa dies without a plan
"I've farmed Grandpa's land for 12 years," this reader says. His grandfather passed away, dividing the farm between his three children, each of whom have different ideas for the future of the farm. Mark McLaughlin shares several useful observations from farm heirs who have succeeded in similar situations.
Focus on family
A young farmer made every effort to work on the home farm with his parents, but eventually decided it was best for his family to move away. He feels guilt for deserting his family and the farm. Jolene Brown assures him that his wife and children should be his priority, and offers strategies for maintaining personal relationships with his parents even though they're no longer in business together.
To incorporate or not to incorporate
Three brothers who are farming together own the assets equally. One wants to form an LLC, but another heard they aren't as effective today. Mark McLaughlin encourages the brothers to consider their specific goals, then find the right tool for the job. He poses several questions they should be asking themselves.
Gifts gone bad
This farmer's advisers recommend he gift 40% of his land to his children to reduce estate losses. He wonders if there are other things to consider. Mark McLaughlin says, "I've seen well-intentioned gifts go bad when the gifting was not aligned with the farm succession goals." He shares several dos and don'ts to avoid future problems.
Keep a good thing going
A farmer who feels he is paying his employees well and implementing best practices, but says that's not enough for them. Jolene Brown shares three things employers need to know. She says, "I’ve learned that strong leaders know they’re in the people business, and that it’s much better to have a satisfied, energized work team than to always be looking for new employees."
- READ MORE: 3 ways to retain good employees