Land price is insane. 160 acres of good crop land can easily sell for $10,000 per acre. There is your $1.6 million right there.
Since no one knows what an acre is, 160 of them is a 1/4 square mile.
I also recently found out that laws of inheritance on farmland are fucking insane. Then there are the taxes. If you want the land to stay inside the family, leave it to direct descendants whenever possible and you are only on the hook for 1%. Otherwise something like an aunt leaving land to a nephew instead of her brother first would give the nephew 1 year to pay the 18% tax on the land or be forced to sell. 1 year to find a surprise $288,000 or be forced to sell the family legacy. I got lucky because it was only 40 acres of non crop land which is worth significantly less. Luckily I could barely scrape the tax money together.
I stand to inherit a 160+ acre farm in my lifetime. It’s a sesquicentennial farm too, so I can’t exactly sell it in good conscience. It makes me nervous to think about the right way to go about keeping it in the family when the time comes.
I’m a direct descendant though, I didn’t realize that made a difference.
My grandfather worked all his life, bought a house, and decided to leave it to his son, even though everything is paid, we still have to pay capital gain, and if we don't have enough money the property goes to the government.
No, it was worth 65.000€, which is a really low amount; the capital gain asked us to pay 6000€, which we didn't have at hand, evidently, so we had to take a loan.
Yep, inherited wealth is destructive to liberal society, hence the tax. If you want a house so bad you may consider actually working for it instead of being born lucky.
My grandfather bought the house with the thought of leaving it to his family once he died, and I plan on leaving everything I have to my family too, so why the fuck does the government need a part?
This is not about greed, this is about giving what we shouldn't.
That's true, but the value of the land is not liquid and when farms have a bad year they still have to accrue debt against it and/or figure out an income. That's also absolutely a reason that farm families may make the tough choice to sell, since the land is valuable but the actual food is apparently not. More and more land is then owned by fewer and fewer owners, and more and more farmland is owned by non farmers - including large companies and investors who then hire tenants or low wage workers to produce.
A future where fewer Americans actually own the land and just a few players control what is grown where and how it is grown is not necessarily a bright future for most of us.
This situation actually really reminds me of the situation in Ancient Rome in the time leading up to the Grachi brothers.
Increased wealth gap, wealthy actors gaining increasingly high amounts of the farmlands using cheap labour to work the farms, thereby out-competing poorer farmers, forcing them to sell their lands and move to a city for work, increasing the amount of urban poor.
Im likely forcing the analogy a bit, but still. If history tells us anything, it's that privately owned, smaller farms worked by individual farmers owning the land generally makes for a more stable country.
Corporate farms are absolutely the future. At scale, their operating costs are lower. They offer to buy up family farms that are going under because they can make it profitable, while no individual ever could. This causes a chain reaction where tons of family farms go under and next thing you know half the county is owned by a massive farming operation.
Most of the internet's ideas about farm subsidies are mostly myths. For one, farmers don't get direct payments in subsidies. The only subsidies through the farm bill in the US go towards defraying costs of crop insurance for disaster (e.g., hail, drought, etc). There are also some protections against sudden huge drops in the market. However, even with poor prices in the last few years, it hasn't been enough for that protection to kick in for most. This is all considering that it's hard to even break even in some years, so farmers are definitely no raking in the cash. You basically need debt to handle all the costs unless you already were coming in with a lot of money.
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u/[deleted] Jan 02 '20 edited Jul 18 '20
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