A Monte Carlo Simulation of the Tax Burdens and Impacts Associated With Common Intergenerational Family Farm Transfer Strategies

This paper utilizes a Monte Carlo approach to simulate intergenerational farm property transfers within the context of four common succession strategies across series ordinary income and capital gain tax rates. Ordinary income/expenses accompany these in form interest potential for depreciation recapture all sales between parties where transaction prices exceed basis financing is utilized. Finally, post-transfer charges successor may usage family assets exchanged. The findings highlight fact that through estates represent best pure outcomes (lowest aggregate burden), while transactions involve highest burden. conclusion it would be prudent well-advised everyone contemplating or engaging ensure considerations focus evaluating, determining, selecting timing course action.