By Jennifer Whitlock
Planning for the future can be intimidating, especially when it includes estate planning for the family farm or ranch.
Taxes, insurance, division of assets, succession plans for family businesses, deeds to the land and more can all cause major headaches—and heartaches—if not taken care of prior to a death in the family. Transition planning is vital to ensure a smooth handover from one generation to the next when the need arises.
“Estate planning is an issue that’s unique in that it’s applicable to anyone. It doesn’t matter if you own a farm, raise cattle, grow crops, whatever. It still applies,” Tiffany Dowell Lashmet, Texas A&M AgriLife Extension Service agricultural law specialist, said.
To help families start the planning process, an in-person event featuring Lashmet will be held in Spearman on March 2 from 6-8 p.m. The seminar, hosted by the Hutchinson and Hansford County AgriLife Extension offices, costs $10 and is jointly sponsored by First National Bank-Spearman and Plains Land Bank. A meal will be served during the event.
Lashmet also will present at another workshop, Successful Succession, hosted by Texas Corn Producers (TCP) in Dumas on March 8. This event is offered at no cost to attendees, thanks to a grant obtained by TCP to cover associated costs.
“Estate planning is one of my more popular topics and usually we have a good turnout at these. The pandemic has caused a bit of a run on estate planning. If you look at the number of people who have drafted a will in the last year, the numbers are staggering,” she said. “It’s encouraging to know people are thinking about that, despite the fact it took a pandemic to make more people realize they needed a plan in case something happens to them.”
During the program, Lashmet will cover five steps to a successful transition plan: creating a flight plan for documents, communicating with interested parties, developing a business transition plan, developing an estate plan and drafting and implementing the plan.
“Step one, getting a flight plan, is just gathering documents, information and getting it all collected in one place and making sure someone knows where that is. That sounds basic, but you’d be shocked at how helpful it is and how many people haven’t done it,” Lashmet said. “If you can do this one thing, it’s a bit of a pain to get started, but it sets you up for success to carry on and complete your estate plan.”
Taking time to identify goals for a family operation and having conversations with potential heirs is another important step.
“We need look at the issue of who’s going to own what and really discuss, ‘What do we have to do to make sure this business continues?’” Lashmet said. “A lot of times, when the next generation is going to step in, there are multiple people involved, and it’s good to identify people’s strengths and what lanes they need to stay in to be successful.”
Basic legal documents like a will, power of attorney and advance directives and how to obtain those documents will be discussed.
The final step is developing and implementing the plan.
“Use a lawyer, loop in your accountant and revisit the plan occasionally,” Lashmet said. “A will you create when your kids are still underage doesn’t necessarily transition well to adult children in their 30s. You may have considered custody arrangements but not business operation provisions. So, don’t just do it once and forget about it. It’s a lifelong process.”
To register for the Spearman event, contact the AgriLife Extension offices in Hutchinson County at 806.878.4026 or Hansford County at 806.659.4130 by Feb. 28.