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  1. Managing Property Title Risks for Montana Farm/ Ranch Operators • Western Center for Risk Management Education

  2. Marsha A. Goetting Professor & Extension Family Economics Specialist Department of Agricultural Economics & Economics

  3. James B. Johnson Professor & Extension Farm Management Specialist Department of Agricultural Economics & Economics

  4. Duane Griffith Assistant Professor & Extension Farm Management Specialist Department of Agricultural Economics & Economics

  5. Partnerships Western Center for Risk Management education Montana Grain Growers Association Mountain States Beet Growers State Bar of Montana Msu Extension Faculty

  6. Educational Methods • Interactive Video Conference • Seminars

  7. Interactive Video Conf. • MSU Burns Telecommunications Center • February 9, 2005 • 2 to 4 PM • 115 preregistered • 274 attended

  8. Bozeman Lewistown Glendive Sidney Glasgow Culbertson Baker Wolfe Point Great Falls Havre Geraldine Stanford Table 2: 12 Sites:

  9. Fall & Winter Series—Table 3 • 11 locations • October 2004 • January 2005 • Total = 289 participants

  10. Conferences-Table 3 • Montana Grain Growers—Great Falls • Western States Beet Growers—Billings • Young Ag Couples—Helena • Total = 115 participants

  11. Multiple Day Workshops—Table 3 • Cabin Fever: Havre • Spring Thaw: Billings • Granite County Herdsman School: Phillipsburg • Total = 75 participants

  12. Estate Planning: the Basics—Table 4 MSU Extension--$10 Mailing List Updates

  13. 27 MontGuides www.montana.edu/extension econ/publications/estate.html

  14. Program Outline — • Content • Farm/ranch family members • Wage/salary earners • Small business owners

  15. Evaluation—Table 6 • What actions did participants take as a result of the program?

  16. Participant Involvement Technique for Teaching Content

  17. Estate Planning Team Contest • Valuable prizes !!!

  18. Team Name • Decide on: Team Name Feisty Critters

  19. Take turns--Team Runner • Sticky Notes • Write team name & answer on sticky note each time you respond to question Feisty Critters 50%

  20. Question • What % of Montanans paid an Inheritance tax in 2003?

  21. Montana InheritanceTax 0 %

  22. Question • What % of Montana deceased persons’ estates paid a federal estate tax in 2003?

  23. Federal Estate Tax • 2003--8,426 deaths • 189 paid • 2 %

  24. Planning Technique Die in appropriate year!!!

  25. Estate Tax Exclusions & Credits

  26. “Who” Gets Your Property When You Die????

  27. Property passes by: • Contract Law • Written Will • Montana Law of Intestate Succession • Trust Agreement

  28. Contracts • Examples • Life insurance • Annuities • IRAs • KEOGH

  29. Bill Vere Life Insurance

  30. Beneficiary • Bill has $100,000 life insurance policy • Designates Vere as primary beneficiary

  31. Bill’s Will • “I bequest all life insurance proceeds to my son, Chris Shelton.”

  32. Who gets $100,000? • Vere? • Bill’s son, Chris?

  33. $100,000 Life Insurance Proceeds • Vere • Contractual • Designated Beneficiary

  34. Payable on Death Designation (POD) • At death ownership passes to POD beneficiaries • No probate

  35. Transfers on Death (TOD) Registration • Stocks • Bonds

  36. Sole ownership Mother 1/2 Dad 1/2 Single Guy/Gal

  37. What fraction, if any, will brother receive? No will

  38. Right of Representation ?

  39. Question • What % of Montana farm/ranch operations are titled in sole proprietorships/ family?

  40. Business Arrangements--2002 Census, Montana Sole proprietorship/family 81% Partnership 8% Corporation 10% Estates/trusts, other 2% *over 100% due to rounding

  41. Married Couple • John & Mary farm (land, equipment, etc) John’s name only

  42. Auto Accident • John dies first • Mary dies3 days later

  43. Question • Who receives the property?

  44. Who Receives? • John dies first • Mary dies3 days later

  45. Whose relatives receive????? • John dies first • Mary dies 3rd day • John’s relatives receive property

  46. Montana Survival Requirement • An heir must survive 120 hours • Otherwise, treated as predeceasing the decedent

  47. What if ??? • John dies first • Mary dies 6 days later • Mary’s relatives receive property

  48. Sole Ownership • John & Mary need a written will • if they want to control who receives the property

  49. Parents have 3 children

  50. Question: What fraction, if any, does grandchild receive? ?