Transferring Land While You're Still Alive: Pros and Cons for Minnesota Farmers

Fall in Farmington, MN, is a time for harvest and reflection—an ideal moment for farmers to consider the future of their land. Succession planning is critical to ensuring that your family farm remains productive and within the family for future generations. But what’s the best structure to choose?

Will or Trust?

• Wills: Simple to draft, but may lead to a longer probate process.

• Trusts: More private and can reduce or eliminate probate, providing smoother asset transition.

Family LLCs or Partnerships:

• Family Limited Partnerships (FLPs): Allow you to transfer ownership shares gradually while maintaining control.

• LLCs: Offer flexibility in management and limited liability for family members involved in operations.

Buy-Sell Agreements: Essential if your farm is co-owned with other family members or partners. These agreements set terms for the sale of shares, ensuring continuity in case of death or exit of a partner.

Farmers in Dakota County should start discussions with their heirs and consult estate planning professionals to tailor a structure that matches their vision and complies with Minnesota regulations.

Questions? Reach out to our estate planning attorneys here.