Probate & Trust Administration
Probate is essentially the court process to determine whether or not a will is valid. It also consists of paying the decedent’s debts and distributing his or her assets as instructed in the will. In Indiana, a will must be probated in the county where the deceased person lived at the time of his or her death. If the deceased person did not live in Indiana, the will may be probated in the Indiana county where the deceased person had property.
Perhaps the most effective way to avoid the probate process is to have a simple revocable (also referred to as “living”) trust. With a simple revocable trust, all assets can be placed in trust and the probate process avoided at death. Assets held in the name of a Revocable Living Trust at the time of a person’s death will pass directly to the beneficiaries named in the trust agreement and outside of the probate process. A revocable trust also provides the following:
- Provide creditor protection.
- Provide for assets to be held and administered years after death. This is helpful when assets need to be held until young children reach adulthood.
- Provide for incapacity: Assets held in the name of a Revocable Living Trust at the time a person becomes mentally incapacitated can be managed by their Trustee instead of by a court-supervised guardian or conservator.
- Privacy: A trust agreement can remain private and avoid becoming public record. This keeps details about your assets and who you are leaving them to out of the public eye.
Almost every farm estate plan should utilize a revocable trust. We can assist you in creating the proper trust to meet your estate planning goals.
Farm Family Divorce
Nobody wants it to happen but it does. Generally 50% of marriages end in divorce. It is likely higher if you run a business. Some experts believe that more farms will be lost to farm divorce in the future than were lost during the 1980 farm crisis. A farm divorce an simply be devastating to a farming operation. Many states have divorce laws that essentially split the assets 50-50 between a husband and a wife. That means, with the stroke of judge’s pen, half the farm can be gone. From there, the remaining half is unable to sustain itself and the farm collapses.
What can be done to keep a farm from being devastated by a farm divorce? Well, for starters a prenuptial agreement can greatly help. This is an agreement that spells out various terms and conditions that will govern a farm divorce between a husband and wife.
Second, depending on the state you are in, you can even enter into a post nuptial agreement where terms and conditions are agreed to after the marriage has started.
Third, using an LLC or trust can also be effective. If one generation gifts or transfers to another, having an LLC or trust can be very helpful in protecting assets in case there is a divorce.
It is important to remember that farm divorce can rival any natural disaster or other terrible infliction onto a farming operation. A little bit of planning will likely go a long way in protecting the farm should a farm divorce arise. A good farm lawyer can fight to keep the farm in the family and in operation. Don’t split up the farm until you’ve talked to us!