Estate Planning, Medicaid Preparation, or Both?

Free National Farm Seminar

"Strengthening and Sustaining Farms and Farmers"

Join us for a free seminar featuring a dynamic group of local and nationally recognized individuals discussing the path farmers need to be on so as to strengthen their operations and also themselves.

When:   February 5, 2020

Where:   Ivy Tech Community Campus, Logansport, Indiana.

          On February 5, 2020, at 5:00 pm, there will be a seminar in Logansport, Indiana, at the Ivy Tech Community Room, located at: 1 Ivy Tech Way, Logansport, IN 46947.  Our seminar will focus on ways to strengthen your farm and yourself.  We have been blessed with being able to bring in a strong lineup of speakers from across the County.  

            For many farmers, times are still very tough in agriculture.  The down economic conditions continue to persist with some saying such will continue for quite some time.  For many farms, survival will not come down to growing the most bushels.  Rather, survival will come down to being better business managers and taking advantage of income generation and savings that may not have had to be utilized in the past.  The old saying “if you keep doing what you been doing, you will keep getting what you been getting” rings more true than ever.  This seminar is geared towards getting farmers to recognize changes that will be beneficial to their operations and how to implement them.

            In addition, it goes without saying that current times have seen a rise in stress among farmers, and sadly, suicides.  I’ve personally reached out to Ted Mathews from Minnesota, who is a nationally recognized mental health expert that has spent decades helping farmers and asked him to be a part of this seminar.  Ted helps man the Minnesota Farm and Rural Helpline and has been on the front lines of mental health issues with farmers. 

            I am hopeful that information from this seminar will directly help attendees and make a difference this year for their farm, themselves, and, especially in timely spotting mental health troubles,  perhaps even their neighbors.  Without further ado, our lineup and topics are as follows:

John Schwarz, II.  Ag-Lawyer, Farmer, and Farm Advocate.  Royal Center, Indiana.  To say that we, as farmers, are resistant to change, might be the understatement of the new year.  For example, studies show that 85% of non farm businesses are structured as a legal entity, such as an LLC, corporation, partnership, or otherwise.  The most popular choice now is the LLC.  In fact, you would probably be surprised to know that Chrysler, Amazon, Nike, E-bay, and many other famous companies are structured as an LLC.  I think it goes without saying that companies of this size would not have chosen the LLC as the entity structure if it was not advantageous to do so.

  Now, allow me to address farm business structures, or lack thereof.   Sadly, the USDA recently reported that a staggering 86% of farms in the US are still operated as a sole proprietorship.  Basically, the exact mirror imagine of non-farm businesses.  I stand firm in telling clients that farming as a sole proprietorship is a recipe for disaster in that the farmer is only one accident, environmental issue, or financial crisis away from losing everything.  In addition, properly setting up the farm provides the ability to benefit greatly from a tax standpoint.  Lastly, succession planning is greatly streamlined when the farm is structured correctly.  As I say all the time, farmers do not trot the horse and plow out any longer as it is yesterday’s technology.   So, when it comes to the structure of the farm, why are so many farmers using yesterday’s business model?  What will it take to get farmers to take up a modern business structure for their farm?  Can progress be made in this area?  These questions, as well as in depth discussion of benefits in properly structuring your farm, will be the topic of my portion of the seminar.

            

Jeff Milligen,  CPA  Baker & Milligen, Logansport Indiana

One of the most dreaded words to a farmer is the word “taxes”.  The non-farm citizens of this country usually view paying tax as confirmation that they had a profitable year.  Well, not us farmers.  Farmers view having to pay taxes as noting short of a catastrophe.  I have seen clients make poor purchase decisions, poor marketing decisions, and everything in between, all in the name of saving on taxes.  I always say that, as farmers, tax planning (if you want to  call it planning) either consists of end of the year equipment purchases, often of which we do not need.  Or, we “can kick” where we do the famous pre-payment of input expense for the next year in the current year.  “Can kicking”, is just that, you are kicking the tax liability into the next year.  It can work, but what happens if you have less expenses the following year?  For example, weather leads to reduced planting, so less acres, thus less expenses.  Or, the farmer retires, but holds grain into the next year to maximize the carry in the market, but has no expenses. 

Would it not be nice if there was another viable method of saving on taxes instead of unnecessary purchases and “can kicking”?  Of course, so I have asked CPA Jeff Milligen to discuss how farmers can save on taxes by using an LLC or Corporation to minimize taxes.  Jeff has been a practicing CPA since 1993 and speaks with a national tax education company.  If done properly, the possibility exists to greatly reduce tax liability.  Numerous times over the years I have seen clients, with a properly structured farm, save on tax liability so that “can kicking” or purchasing is not needed.     Jeff will also talk about recent changes in tax laws from the 2018 Tax Cuts and Jobs Act that affect farmers. 

Todd Landrum, Ag Resource Management, Huntington, Indiana

In my practice, I have been assisting numerous clients as it pertains to their farm finances and lending situations.  Sadly, many lenders have tightened up and farmers are finding themselves having fully pledged land and equipment leaving no room for an operating loan.  Todd will discuss how to strengthen your farm operation via obtaining operating loans based off of crops and crop insurance, instead of pledging hard assets such as land and equipment.  Todd has been a big help to several of my clients, so I have asked him to be a part of our seminar in hopes perhaps there are other farmers that he could assist.

 Andy Junkin, Agricultural Strategy, Iowa

Over the years, I have come to the conclusion that every farm family as a certain degree of dysfunction.  I joking say the “D” in dysfunction ranges from a subscript size “D” to a billboard sized "D". Andy is a national speaker and has literally “written the book” on farm family dynamics with farm families and working together.  Actually, he even actually has written a book: “bullet proof your farm”.  Andy has been kind enough to provide free copies of his book at our seminar.  We all know you can have the best farm in the world, but if the members of the farm cannot get along, then the farm will not survive.  Sadly, in my practice, I seem to see more contention with farming families, owners of farm ground, and farming partnerships.   Maybe it is a sign of the times.  Maybe it is due to the economic downturn.  Whatever the reason, Andy will be addressing many of the issues that confront farm families in getting along.

  

Susan McClish, Agri-File Solutions, LLC   Howe, Indiana   Like it, hate it, or do not care, either way government programs and their impact are front and center in farming again.  ARC/PLC, Market Facilitation Program, EQUIP, Conservation incentives…the list goes on.  There are numerous government programs that can be a resource for farmers.  Sadly, many farmers are unaware of the programs they qualify for and what needs to be done to ensure they maintain eligibility.   Susan McClish has 30+ years with the Farm Service Agency, and upon retirement, founded Agri-File Solutions, LLC, that assists farmers with ensuring they are aware of eligible programs, how to qualify for ones they are not, and assists farmers with making sure their yearly required documentation is in order.  The data I have reviewed shows that direct farm payments are the highest since 2005.  Thus, these payments equate to a large portion of farm income and I think it is import for farmers to, at the very least, know what is available and how to qualify.

 Ted Matthews, Farm Mental Health Counselor, Saint Paul, Minnesota.

As mentioned above, with the number of articles I have read this year on farmer mental health, farmer depression, and farmer suicides, I wanted to work in an element of this seminar regarding farmer mental health.  Ted Matthews is literally on the front lines of mental health as he helps man the Minnesota Farm and Rural Helpline.  He will discuss managing stress, the warning signs of mental health issues, and how to get help when needed.  The stigma of mental health issues among farmers appears to be easing, but more discussion is needed on this subject.   Especially when it comes to getting help to farmers who are restive to getting help. 

     We would appreciate your support of this seminar as we believe there will be a lot of information to be gained that can make and impact on our farms.  If you do decide to attend, you can call 574-643-9999 to attend.  Later this month, more information will be posted on our website at www.thefarmlawyer.com.