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Wills are important for Texas farmers looking to bequeath land

Keeping the family farm in the family can be tricky, but careful estate planning can help. Wills are definitely important for any Texas rancher or farmer wanting to pass on that land to the generations of the future. Luckily, Congress has made the process somewhat easier with some changes that were made to the estate tax laws for 2013.

The estate tax exemption has been raised to $5.25 million per person this year. In essence, that means that a married couple shares an over $10 million exemption. Essentially what this means is that if one spouse dies using less than the allowed $5.25 million, the other spouse can add whatever amount remains to their individual $5.25 million exemption. If for some reason, the estate is worth more than the exemption, Congress has passed a law making anything above the current exemption taxable at 40 percent. 

However, many Texas ranchers and farmers may never have to worry about that 40 percent since the exemption is often generous enough. The estate tax laws also allow farmers and ranchers to transfer property valued up to $5.25 million during the life of the person transferring the property. Of course, keeping the family farm in the family isn't only about avoiding tax liability.

There are other legal and financial considerations that can be handled in wills and trusts. There may also be business entities involved that will also need to be dealt with as part of an estate plan. No matter what the goals are regarding passing down the family farm or ranch, those issues and goals can be included as part of a successful estate plan.

Source: kansascity.com, "Tax, estate planning crucial for keeping, passing on farmland," Gene Meyer, July 8, 2013

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