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The laws governing what and executor can do are so strict.

The laws that govern what an executor can and can't do are so specific ,that you really DON'T need a bank. If anyone gets shorted, or they can sue the executors. A judge usually oversees the whole process. Save your money.

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Veteran Contributor

Re: The laws governing what and executor can do are so strict.

Where do you find the aLaws that govern  executors

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Highlighted
Frequent Contributor

Re: Long Term Planning

Minnisota, Let me throw in some info that I have observed that may reignite the emotions of this thread.   After reading all of your discussions and answers from other contributors, I will add the following to the fire.

 

I would suspect that your wife's family has a C-Corporation since you have not received any K-1's and you are inferring that it is a corporation.  If it's some other type of entity then my comments are for naught.  If a family is gifting shares of stock before death, I would assume they are doing it for estate planning purposes or they are giving her some shares to "make up" because they are helping other family members.

 

If this is the case, unfortunately they are not worth very much until the parents or "primary stock owners" pass away and their remaining shares are distributed.  This is because as a "minority" stock holder, she does not have enough stock shares to control any "votes" of management decisions (i.e. if she has 20 shares out of 1000, she has no power since it take 50.1% of the shares to make decisions).  Also, when owning minority shares in a closely held family corporation, they have practically no value since no one outside the family would give her anything for them.  This is because the only taxable income a C-Corp. can pass to her is in the form of dividends.  It takes a majority vote of the stock holders to authorize a distribution of dividends to all stock holders. 

 

As previous posters have said, a C-Corporation must have an annual meeting where they should provide a summary of the previous years income, an expectation of the coming year, an election of officers, as well as other items as required by law.  She should be notified when and where the annual meeting is to be held.  This is the best time to find out most of the questions she may have about the corporation.  I "think" she should also be entitled to a copy of the corporate tax return but may have to pay for the copy.  Also, as others have mentioned, she should be entitled to a copy of the bylaws, which should have provisions regarding the options for a sale of a persons stock.  This would also be helpful. 

 

Now in my humble opinion, if the corporation is successful and growing, her shares should continue to increase in value at probably a better rate than current investment options.  If that is the case, sit back and let them grow in value.  However, many farm C-corps do not put land in the corp. because of the double taxation rules.  If that is the case (determined from a copy of the annual meeting reports or the tax return), then the corporation may not be worth very much because the majority stock holders are probably paying themselves wages large enough to support their land buying habits and to limit the growth of the corp.  If this is the case, then this stock is worthless and she will need to decide how to proceed and what feathers (relationships) she wants to ruffle.

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Advisor

Re: As usual, Mr. Kraft shows what he knows.

That does it , don!  I'm withdrawing my request to be adopted by you. Your common sense attitude will confound my attempts at finagling your million$. We might be better friends than relatives, anyway.

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Senior Advisor

Re: As usual, Mr. Kraft shows what he knows.

I would like to adopt you. I would be assured that someone would care for me after the money is gone.

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Advisor

Re: Keep Your Damned Jack

good call, jim. In regard to asking his wife to leave the farm, they still could have rented or purchased their OWN operation.  (at one point). Many have done this in the past and there would have been equipment and help to share from the family. At least that 's what he said she wanted in the first place. Lastly,as a father, I can easily see that there are in-laws that you don't want to be in business with(ever) and this might have been the family's clumsy way of avoiding dealing with a jerk everyday. I absolutely can see this possibilty.

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Veteran Advisor

Re: Keep Your Damned Jack

That reminds me of an amusing story.


I am friends with a nice lady who married one of those 'jerks'.  Her dad, a fairly successful farmer/cattle feeder wanted to do right, and help get them started in farming and cattle, but just couldn't warm up to the guy.

So, when a place 10-15 miles away came up for sale at a very attractive price, he helped them buy it.  He helped his daughter out, he appeased his SIL, giving him a 'start', and didn't have to put up with him on a day-to-day basis.

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Senior Contributor

Re: Keep Your Damned Jack

And I bet he'll do his daughter right when she gets tired of that "jerk" too. If he treats his inlaws like crap, one of the days it may get spilt closer to home than he would like.

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Honored Advisor

Re: Keep Your Damned Jack

I have one BIL who was.is always looking for the next get-rich-quick scheme.  He mostly wanted to own a business, hire people to work in it, so he could sit on his hind end and do nothing but count his money. 

 

One of the most famous ones was that he wanted to open a convenience store...for "only" $1 million in investment.  About then, I recall my father saying to my sister that she "needed to let him get into a little startup, or keep going to school, before he cost her any real money."  He has had more "careers" than I have pairs of socks. 

 

My point is that every family has one....

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Honored Advisor

Re: Keep Your Damned Jack

Kay,

And it is an old saying but it is true------------------------Love is blind.------------------------------------

 

 That is why if one has been granted the ability to own and run a farm business, one has the responsibility to consider the business that passes to his family as well as the family members.  Even love is hard to distribute evenly, although every effort should be made.  But Production asset responsibility should be shared and distributed to those who can handle the responsibility.  Find another way to deal with your fairness issues.  There are those who will never be pleased with anything.

 

just my opinion through experience.

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