Farming land. Worth it or not?

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Doronron

Guest
I have recently been told that i may be enheriting about 120 acres of farm land from a relative.. I have the option of taking it or not, and i'm wondering is it worth hassle of the 'keep' to it?

I dont live near the land(about 2 to 2 1/2 hour drive away) and i've very little farming experience within me.. Some livestock and a house which is need of serious renovation to be comfortably liveable..

I'm trying to find out is there point in me taking it when my life is not near it and is there any ways off making money with it??
I heard forestry is a good investment but not till 20 years time when the trees fully grow.
Any ideas would be helpful!
Thanks
 
I can understand why you wouldn't want the burden, so to help you out, I would be very happy for you to sign over your inheritance to me.

Brendan
 
I too would like to make the same generous offer as Brendan :)

Seriously though, if it's agricultural land it's not likely the inheritance tax will be too high, and there's always the option of leasing it to another local farmer, or to coillte if you just want to hang onto it.
Maybe someday you'd like to live there (i'm assuming you're living in or near a town, and the land is in the middle of nowhere?) too. Try and find out how much the tax would be on the inheritance, that would make it a lot easier to decide if you want to keep it, I suppose.
 
Yeah, gift horses and all that OP! If someone is offering to 120 acres of land, you'd be mad not to take it (unless the inheritance tax was so onerous as to put you off, but surely you could sell a portion of the land to pay that if you absolutely had to).

I'd certainly not refuse it because of "hassle" looking after it etc. Lucky you!
 
All good points, especially the one of giving it over to people ;) but it is a agreed decision to keep the land in my Familys name [Doronron's ;) haha].
It will go to another family member if i dont want it.

But the main factor is, i am looking for ways to get something back on it. Ireally cant see neighbouring farmers wantin to much of it.. Just a huntch with that one. Maybe a field or too but thats bout all..

Putting money into it would not be a problem but the time would be!! If money went in, is there ways of getting it back, if you understand me.
Yes city slicker, Farm is in the middle of nowhere!
 
Doronron,

What is the quality of the land? Even poor land will rent as farmers can get EU payments for leasing additional acreage. Forestry will also give you an annual tax free premium of the order of €200 per acre if you are a farmer. You can qualify as a farmer by acquiring a herd number and keeping a few livestock for a minimum period until the animals are tested and you would be then deemed to be a farmer.

You should also post this query on http://www.boards.ie/vbulletin/forumdisplay.php?f=845 which is the farming and forestry forum to get feedback from people involved in farming.

Are you perhaps more concerned about the reaction of other family members if you took the inheritance and then have to sell the lot, thereby been seen to be cashing in and not keeping the land in the familys name?
 
No well i no i wont be selling the land... There is more fear in a separate family member selling it than me. Thats for sure.
I will check that forum out.
Thanks
 
I work with a few country boys who are also farmers.

Whenever the topic of farming comes up and the slagging starts the lads claim that they are not making money but 'it's costin me moaney'.....

:p
 
Doronron, If the person that owns it now is alive and has a life span longer than a few months, why don't they (especially if they have a herd number), plant it (under the EU forestation scheme. The land in their ownership wll be entitled to the farmers premium for 20 years. Then they should gift it to you where CAT will be minimal as the tax payable is based on the value of the trees. You will need confirmation of this by a Tax expert. The main other expense you should have for the period of growth is Insurance and some maintenance. Forestry is normally a 40 year plan. This idea might help you make a decision.
 
Your "problem" regarding a possible inheritance is one most of us would love to share. You dont mention what the quality of the land is but I am assuming it is "middle of the range". Your tax bill will be minimal as there are slidiing scales depending on the closeness of your relationship to the current owner. The simple and ideal solution would be to plant the land and receive app €24k annually, tax free for 20 years. You will then have thinnings from the woodland to sell and at year 35/40 you can sell the conifer element of the final crop for, in todays money, app 8k per acre, again tax free. This is really a no brainer. And the house can just be left to sit there until better times come along. Contact the local Teagasc forestry advisor who you can find on www.teagasc.ie who will fill you in on all the implications. Then employ a GOOD forestry consultant to act as an independent advisor for a second opinion. You dont need to have any experience and all the work can be done for you by one of the GOOD forestry companies. All the expenses regarding purchasing trees, fencing, planting and after care are paid for by the grant. And like Brendan and some others mentioned, if you still dont want the land, just give it to me!!
 
Not to go to far off topic but what does the state get out of paying for someone to plant trees and then harvest, all tax free? Carbon offsetting or something?
 
As someone who leases land for folk, I can say that land is in demand for conacre, and good land would fetch up to €200 per annum per acre. Depending on where it is and the quality you should realise at least €140 per acre per annum, which is a nice handy 16,800 per annum for essentially doing nothing.
 
What are the legals like wrt agricultural land? Is it seen in the same light as other commercial property, tenant's rights wise? Aside from the new Civil Law Act 2008 which has yet to be tested in court, could a tenant claim a business equity in the property after 5 years continuous leasing?
 
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