The estate tax exemption is $15 million now. That is not a reason to skip the succession plan.

The One Big Beautiful Bill Act permanently set the federal estate tax exemption at $15 million per person, $30 million per married couple, starting January 1, 2026, indexed for inflation. At Iowa land values, that is roughly 1,300 acres per person before federal estate tax is a question. For the large majority of family operations, it is now off the table.

That is genuinely good news. It is also a trap, because "we won't owe estate tax" gets heard as "we don't need a plan," and the two have almost nothing to do with each other.

What actually kills farms in transition

Talk to any ag lawyer or extension farm-transition specialist and the list is the same:

• No plan at all. Mom and Dad die intestate or with a 1990 will that splits everything equally among four kids, one of whom farms.
• Equal is not fair. The farming heir has 20 years of sweat equity in an operation that is now owned one-quarter each by three siblings who want to be cashed out at appraisal.
• The farming heir cannot afford to buy out the others at today's land prices, so the land is sold.
• No income for the retiring generation other than the land, so they cannot let go of it.
• Nobody ever said out loud who was going to run it. Assumptions on both sides, discovered at the funeral.

None of those is a tax problem. All of them are solvable, and all of them get harder the longer they wait.

The first four steps

1. Inventory what there is. Every parcel and how it is titled, every entity and who owns what percentage, the machinery, the cattle, the debt, the life insurance, the retirement accounts. Most families have never seen it all on one page. This is also where you find out that the 80 acres is still in Grandma's name.

2. Figure out what the retiring generation needs to live on. If the answer is "the farm income," then the plan has to keep that income flowing while control transfers, which is different from a plan where they have a pension and Social Security. This number drives everything.

3. Have the conversation about who farms. All of the kids, in the same room, with the parents. What does the farming heir expect? What do the non-farming heirs expect? Is anyone assuming something nobody else is? An outside facilitator, extension, a farm-transition consultant, sometimes the pastor, keeps this from becoming Thanksgiving 1997 again.

4. Then bring in the professionals. An attorney who does farm transitions specifically (not the one who did the closing on the house), an accountant who understands the difference between a stepped-up basis and a gift, and your lender. The order matters: the family decides what it wants; the professionals design the structure.

Tools that come up

• Entities (LLC, LP) that let ownership transfer in units over time while management stays with the farming heir.
• Buy-sell agreements with a formula price and terms, so a buyout is a schedule, not a fight.
• Life insurance on the parents owned by the farming heir, to fund buying out siblings.
• Gifting using the annual exclusion (now $19,000 per recipient per year) to move ownership without touching the lifetime exemption.
• Stepped-up basis at death, which is the reason most advisors still say do not give away appreciated land during life if you can help it. The heirs inherit it at today's value and can sell without capital gains.

The thing to do this month

Step one. Get the inventory on paper. It costs nothing, it takes a weekend, and every professional you eventually hire will ask for it first. Iowa State's Beginning Farmer Center and most land-grant extension services publish workbooks for exactly this.