July 23, 2014

Keeping the Family Farm in the Family

Like many Midwesterners, I grew up working on a farm. I lived just across the road and about a city block North of my grandparents' dairy farm in rural Minnesota and I grew up helping them on the farm.  I have a lot of very fond memories of being a "farm kid."  After a number of years, due to my father's deteriorating eyesight, my parents got more traditional 9 – 5 jobs and we all stopped doing substantial farm work. Another family member took over helping my grandfather and ultimately that family member inherited the entire farm.  This family member chose not to maintain the dairy farm, which created a lot of concern among the family that the farm land -- some 600+ acres of fields and forest and our grandfather's legacy --might be sold off and lost to strangers. 

The family farm is becoming extinct in this country. If you have this fear about your own farm, or a farm in your family, there is a potential solution.   While farming is a way of life, it is also a business – and not a 9-to-5-paid-vacation-and-sick-days kind of business. Farming is the definition of "hard work".  It is not a way of life that works for everyone, and often times farm families split – some leave the farm, leaving one or two relatives to take over the business when the parents are ready to pass it on.  However, those children that leave don't necessarily want to give up the land to be used for activities like hunting, or ATVing; or they may enjoy doing field work and benefitting from those profits (hay, stray, soybeans, etc.). 

Believe it or not, an attorney can help keep this family business in the family, serving both those who stay and work on the farm, and those that just want to secure the real estate.  Putting it in the simplest terms possible, this plan consists of separating the "land" part of the farm from the "business" part, and putting each of those parts into a different entity Those working on the farm earn the profits that come through the business entity, and they in turn pay rent at fair market value to those family members that are not working on the farm. While it is much more complex than just creating two separate entities, and every family farm structure is different, there are solutions that will help you keep your family's farm in your family.

(Editor's Note: Attorney Jessica DesNoyers authored this post while working in Varnum's Grand Haven office. Jessica is currently with another firm.)

© 2014 Varnum LLP

About the Author


Jessica is a staff associate in the firm’s corporate practice group. She is a regular contributor on estate planning matters in Varnum's blog, under the Legacies category.


Boost: AJAX core statistics

Legal Disclaimer

You are responsible for reading, understanding and agreeing to the National Law Review's (NLR’s) and the National Law Forum LLC's  Terms of Use and Privacy Policy before using the National Law Review website. The National Law Review is a free to use, no-log in database of legal and business articles. The content and links on are intended for general information purposes only. Any legal analysis, legislative updates or other content and links should not be construed as legal or professional advice or a substitute for such advice. No attorney-client or confidential relationship is formed by the transmission of information between you and the National Law Review website or any of the law firms, attorneys or other professionals or organizations who include content on the National Law Review website. If you require legal or professional advice, kindly contact an attorney or other suitable professional advisor.  

Some states have laws and ethical rules regarding solicitation and advertisement practices by attorneys and/or other professionals. The National Law Review is not a law firm nor is  intended to be  a referral service for attorneys and/or other professionals. The NLR does not wish, nor does it intend, to solicit the business of anyone or to refer anyone to an attorney or other professional.  NLR does not answer legal questions nor will we refer you to an attorney or other professional if you request such information from us. 

Under certain state laws the following statements may be required on this website and we have included them in order to be in full compliance with these rules. The choice of a lawyer or other professional is an important decision and should not be based solely upon advertisements. Attorney Advertising Notice: Prior results do not guarantee a similar outcome. Statement in compliance with Texas Rules of Professional Conduct. Unless otherwise noted, attorneys are not certified by the Texas Board of Legal Specialization, nor can NLR attest to the accuracy of any notation of Legal Specialization or other Professional Credentials.

The National Law Review - National Law Forum LLC 4700 Gilbert Ave. Suite 47 #230 Western Springs, IL 60558  Telephone  (708) 357-3317 If you would ike to contact us via email please click here.