Whether formed before the advent of more tax advantageous entities or the result of utilizing specific planning opportunities, many farm and ranch families today still operate out of corporations. Rising land prices, low relative cash flow, and changes in tax law over the last two decades have made the transition of these family farm and ranch operations increasingly difficult. Multi-owner operations face substantial tax challenges when potential divisions are necessary to meet current objectives. For those advising family farm or ranch corporations, Section 355 of the Internal Revenue Code provides a valuable tool for agricultural businesses to divide into separate corporations without triggering immediate income tax consequences, allowing for further tax-planning opportunities down the road.

In the September/October issue of Nebraska CPA, Koley Jessen attorneys Nick Bjornson and Nate Patterson explore Section 355 transactions, addressing what they are, the key requirements for implementation, and essential planning considerations for advisors.

Read the full article at the link below. 

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