Well, well, well. Here we are nearly a year after an election fiasco, followed by numerous tax proposals that had farmers, attorneys, CPAs and planners everywhere very concerned, scrambling for solutions and worrying about what could happen.

It’s not like the proposal just had one bad issue, it had multiple grave concerns that beat up farm estates, from nearly every angle. One by one, those proposals were trimmed back, and now here we are, and it appears that very few, if any, of the reconciliation proposals that would’ve hurt farm families will be implemented. So here are my takeaways:

  • What did you do while you were waiting? Did you do something radical, like make a big sale or transition a bunch of assets, or gift something, or do some razzle-dazzle planning? Did you do nothing because you didn’t know what to do? Did you do something to position yourself in case these laws were passed? Ironically, in my 21 years of doing farm transition planning, estate taxes have always been a talking point, and for some, there is a legitimate concern. However the biggest problems for most estates is with how you distribute the assets. So while you were waiting, did you address or review those concerns?
  • Proposals are just that. They are ideas that someone threw out seeing if it would gain any traction. I did not keep track, but I would suspect well over 90% of the correspondence I had over the past year started with someone stating “this new law.” I often interrupted and asked “what new law?” I concluded it was best to be prepared but not panic.
  • Another takeaway is that even though very few of the detrimental proposals appear to be on track for implementation, make no mistake, we got to see the playbook of the “opposition.” In athletics, it’s always fun to watch a little game tape of the team you will be playing and try to figure out what they’re doing, when they’re doing it, and how they disguise what they’re going to do. It’s especially rewarding when you almost think you know the play they’re going to run before they even run it. Well guess what? We just got to see the playbook. They didn’t even disguise it or attempt to fake anyone out. They just came right out and said, here it is. It would be like playing a football team with 350-pound linemen that never missed a day in the weight room and just lined up and said, “We’re going to run it down your throat all day long. Good luck trying to stop us.” It would be like playing a basketball team with the starting five that average 7 feet tall and they’re going to what they want to do, when they want to do it and you can’t stop them. That’s the playbook we just saw. Now we know it is out there and it’s not going to go away. I would suspect over the years, there are going to be numerous attempts to take some of those plays from that playbook and use them in the future. Agriculture voices both as individuals and groups need to stay vigilant on the matter. We know the wolf is at the door.

So while you’re waiting for the next go-around, make sure you’re clear with your distribution plan and make sure you’re taking incremental planning steps so that the next time you see a play coming, you’ll know it before they even run the play.

Myron Friesen is the co-owner of Farm Financial Strategies Inc. in Osage, Iowa. He can be contacted at 866-524-3636 or friesen@farmestate.com.