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Abstract

The farmer and rancher in the United States have departed from the era when the fruits of agricultural enterprise were primarily the product of one's hands, and have entered an era of declining labor input and continually expanding employment of capital. In the present economic and tax atmosphere, incorporation of the family agricultural unit is an increasingly popular method of accommodating both death taxes and family inheritance. The purpose of this article is limited to an examination of the ways in which incorporation may help achieve the basic objectives of the estate-planning process, which may be summarized as follows: (1.) optimization of the marital deduction, (2) reduction of the gross estate through gift-giving, (3) reduction of asset values for the purpose of estate tax valuation, (4) stabilization of asset values for purposes of estate tax valuation, (5) preservation of the family operating unit, (6) reconsolidation of operating unit ownership in the operating successors, and (7) formulation of an effective means of estate administration and postmortem estate planning.

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