This Succession Planning Tool Works for Farm Families
For years, Dan Kohl worked the ground of his family farm alongside his son, pouring his life into the operation. But when his mother died and it came time to settle the estate between him and his five siblings, the numbers didn’t add up. Buying out his siblings wasn’t a viable option. The alternative, selling the land at auction, meant saying goodbye to generations of family history and the livelihood Kohl had built for himself and his family.
“It felt like we were boxed in,” Kohl recalled. “I didn’t want to lose the farm, but I also didn’t want resentment or financial strain to come between me and my family.”
That’s when the family discovered a little-known tool called a 721 exchange. Working with the Legacy Farmland Fund, they found a way to keep the farm intact while making sure everyone received fair value. Kohl and his son could continue farming the land, while the siblings received ownership shares they could hold or sell in the future.
“It was a relief to know the farm would stay in the family and that I wouldn’t have to go into debt to buy out my siblings,” Kohl said. “Everyone walked away with a fair outcome, and we didn’t have to sacrifice our relationships to make it work.”
A New Solution for a Growing Challenge
The Kohl family’s story reflects a challenge playing out across the country. As millions of acres of farmland are set to change hands in the coming decades, families are grappling with how to pass land down without losing it to commercial development.
The 721 exchange offers one possible path forward. Instead of selling land outright, families can transfer property into the fund in exchange for shares. This structure allows them to defer taxes, create liquidity and, most importantly, preserve the option for the next generation to keep farming.
Eric Mueller, founder of Legacy Farmland Fund, says that was the fund’s purpose from the start: “Our mission is to help families preserve their farmland legacy. We want landowners to know they don’t have to choose between financial stability and keeping the farm in the family.”
Preserving Legacies, One Farm at a Time
For the Kohls, the exchange meant peace of mind. For other families, it could mean the difference between maintaining a legacy and watching it slip away at an auction block.
“This is about more than land,” Kohl said. “It’s about keeping our family’s story alive.”
Want to learn more about how a 721 exchange works? Visit legacyfarmlandfund.com.
