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Many of you have farm succession plans or estate plans to handle issues related to both on-farm and off-farm heirs. But have you communicated decisions in these plans to both sets of heirs? An interesting case out of North Dakota, Estate of Feldmann v. Evans, addresses that issue. In this case, the Supreme Court of North Dakota agreed that testimony showed the father had gifted all the farm equipment to the on-farm heir, equipment which was not a part of the off-farm heirs’ shares of the estate. The on-farm heir was also entitled to the wheat crop growing on his inherited farmland. The off-farm heirs were only entitled to proceeds from the wheat crop harvested at the time of the dad’s death.
The take-away from this case: families should discuss these issues to make sure that everyone is on the same page, so heirs understand how the property will be treated at death (or when it is gifted to another heir) to reduce tensions and avoid litigation.Read More