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Aug. 4, 2025 Source: Sower's Legacy Farmland Fund OMAHA, Neb -- In Iowa, six siblings faced a difficult decision about the future of the family farm after the death of their mother: sell the land or find a way to let brother Dan Kohl -- who had been operating the farm with his son -- continue farming it. With no one else interested in retaining ownership and no viable path for Kohl to finance a buyout, the land was nearly sold at auction. Instead, the family discovered the 721 exchange, an underutilized tax-deferred real estate exchange facilitated through Sower's Legacy Farmland Fund. The mechanism allowed the siblings to transition their ownership while keeping the farm a family operation. "It was a relief to know the farm would stay in the family and that I wouldn't have to go into debt to buy out my siblings," said Kohl. "Everyone walked away with a fair outcome without putting the farm or our relationships at risk." Through a 721 exchange, landowners can transfer property to the fund in exchange for ownership units. This structure allows them to defer capital gains taxes, avoid losing value in a sale and receive shares that can be retained, sold, gifted or divided. In this case, the son retained exclusive farming rights and a buyback option, while his siblings benefited from receiving shares, which they can later liquidate. "We created Legacy Farmland Fund to offer farmland owners an alternative to selling," says Eric Mueller, founder and managing partner of Legacy Farmland Fund. "Through the power of a tax-deferred 721 exchange, landowners can transition their farmland while preserving generational ownership and accomplishing estate and succession planning goals efficiently. "Our goal with the Legacy Farmland Fund is to provide a tax-efficient, strategic solution for farmland owners who want to monetize their property -- without selling it outright. Legacy Farmland Fund helps you unlock the value of your land, defer capital gains taxes and ensure your farm continues to thrive for generations to come." The Legacy Farmland Fund serves a broad network of stakeholders, including farmland owners, producers and tenants, charitable organizations, accountants, attorneys and financial advisers. Whether transitioning ownership across generations, settling an estate or seeking capital for expansion, the fund provides a solution that aligns the financial, emotional and operational needs of all parties involved. It is especially valuable for families seeking to preserve ownership while creating liquidity or simplifying complex landholding structures. As land transitions accelerate, with more than 370 million acres projected to change hands in the coming decades, solutions like the 721 exchange are poised to become as mainstream as the widely used 1031 exchange. Sower's mission is to equip farmland owners and their heirs with the tools to preserve their land and the legacy behind it. Learn more at legacyfarmlandfund.com. Tweet |
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