Are You Planning
For Succession?
Understanding Your Farm Program Payments
•
Income
limitations:
annual with a long-term view that allows them to
process, you’ll have many options to consider. income limitations, the choice of entity take advantage of the benefits that stem from
Just be sure you don’t overlook your farm has a direct impact on whether any this component of farm income.
program payments. Failure to plan ahead and income regulations are violated or not.
When going through the succession planning
correctly structure your finances can result
in losing some or all of these payments – or
even worse, triggering an unexpected Farm
Service Agency (FSA) audit.
As with any succession plan involving a
farm, your goal should be to maximize your
farm program payments while working to
prevent the occurrence of an FSA audit. This
can be achieved by ensuring your entity is
properly structured and that you completely
understand all FSA rules.
Active
engagement:
To
ensure FSA regulations and your tax liabilities is one
of the most complicated steps in the overall
to have substantial contributions to the process. Fortunately, finding the connection
farm’s operations. is possible – and it all starts with having the
If you benefit from farm program payments,
right team of experts in place.
inform your succession planning advisor. If you are thinking about the future of your
Failure to effectively plan for these benefits farm and would like to begin the succession
could result in substantial losses. planning process, give me a call to discuss
your options. Let’s start planning for your
THE PROCESS
a
succession
future.
plan
that
maximizes your farm program payments
while meeting your goals and reducing
Certain regulations will determine your
farm program eligibility. Just remember that
failure to follow FSA rules when designing
your succession plan can have devastating
when
seeking
succession plan assistance, consider the
liability is your ultimate objective. Therefore,
throughout the succession planning process,
each participant will be evaluated against
your farm’s operations. Then, armed with the
evaluation results, your succession plan will
be structured to address your specific goals.
following eligibility requirements: Even though farm program payments tend
• to make the succession planning process
Payment limitations: Each program
has an annual maximum dollar amount
for each individual or entity.
4
Finding the link between succession planning,
eligibility, you or your entity are required
Implementing
ELIGIBILITY
CONSIDERATIONS
consequences. Therefore,
•
With
Rise & Shine • Spring 2019
more complicated, proper communication,
preparation and planning provides farmers
by: Ben Froese, CPA
Senior Manager
545 North Market St.
Wooster, OH 44691
234.249.3454
[email protected]