Author: John

Gifting to Manage Estate Taxes

By: Robert Moore, OSU Extension

The federal estate tax exemption is set to drop dramatically in 2026—from $13.99 million in 2025 to an estimated $7–$7.5 million per person. For some farm families, this shift could result in significant estate tax exposure. While most estates won’t exceed the new limit, some farmers, especially those with high-value farmland or appreciating assets, will find themselves suddenly at risk of federal estate taxes.

Gifting is one strategy to reduce the size of your taxable estate, but it’s not always simple or risk-free. Let’s explore when gifting can help, when it might not, and what to watch out for.

Two Types of Gifts

There are two main gifting categories under federal law:

  • Annual Exclusion Gifts – In 2025, you can gift up to $19,000 per recipient ($38,000 for couples) annually without using any of your lifetime exemption.
  • Lifetime Credit Gifts – Larger gifts are allowed, but they reduce your lifetime estate tax exemption.  The lifetime estate tax exemption is the amount of wealth that the IRS exempts from estate taxes.  The exemption can be used at death, gifted away during life, or a combination of the two.

Example: If a parent gifts a $1,019,000 farm to a child, the first $19,000 is exempt from taxes and does not reduce the parent’s estate tax exemption.  The remaining $1,000,000 reduces the parent’s lifetime estate tax exemption from $13.99 million to $12.99 million.

Gifting Strategies That Work

1. Annual Exclusion Gifts

If you’re just slightly over the expected 2026 exemption, annual gifts can move you back under the limit.

Example: A grandparent with 10 grandchildren can gift $190,000 per year. Over 2 years, that’s $380,000—enough to reduce a modest estate and eliminate taxes.

But for high-net-worth individuals, $19,000 per person may be too little to make a significant impact.

2. Lifetime Gifts of Appreciating Assets

Large gifts don’t directly reduce estate tax liability (since they reduce your exemption), but they remove future appreciation from your estate.

Example: If you gift farmland worth $1M that later appreciates to $3M, only $1M is deducted from your estate tax exemption — the $2M in appreciation escapes estate taxation entirely.

Potential Downsides of Gifting

  • No Stepped-Up Basis.  Gifting assets during life means recipients take your original tax basis, not the stepped-up value at death—potentially increasing future capital gains taxes.
  • Loss of Control & Income.  You must fully give up ownership and control. Gifting income-producing property could impact your financial security.
  • Risk of Financial Mismanagement.  If a gifted asset is lost to debt, lawsuits, or divorce, it’s gone. One solution? Use an irrevocable trust to hold the gift—this protects assets while still benefiting your heirs.

Another Strategy: Pay Directly for Education & Medical Expenses

The IRS allows unlimited direct payments of tuition or medical bills without using your exemption. But payments must go straight to the provider, not to the individual.

Example: Grandpa has a $9 million estate and wants to reduce its size before the federal estate tax exemption drops in 2026. He has four grandchildren in college and a daughter who recently underwent surgery.

Grandpa pays the following directly:

  • $20,000 in tuition for each grandchild (4 x $20,000 = $80,000) directly to their universities
  • $25,000 in hospital bills paid  directly to the hospital for his daughter

Total Reduction in Taxable Estate: $105,000

Impact on Exemption: None—these payments do not count against Joe’s $13.99 million estate tax exemption or annual gift limit, because they qualify under the IRS educational and medical exclusions.  Grandpa could still give each of those recipients an additional $19,000 under the annual gift exclusion without any tax consequences.

Conclusion: Gift With Caution and Professional Help

Gifting can be an effective estate tax strategy—but only when used thoughtfully and with professional guidance. Consider the loss of stepped-up basis, the asset’s appreciation potential, your own financial needs, and the stability of the recipient. For some, the risks of gifting may outweigh the benefits.

With estate tax rules changing in 2026, now is the time to review your estate plan. Consult your attorney and tax advisor to determine if gifting fits your strategy—and how to do it safely.

For more information on gifting and estate taxes, see the Gifting to Reduce Federal Estate Taxes bulletin available at farmoffice.osu.edu.

Weekly Commodity Market Update for April 22, 2025

Brownfield’s Weekly Commodity update featuring former OSU Extension Ag Economist Ben Brown.  This week Will and Ben discuss how tightening corn ending stocks sets the futures market up for gains if adverse weather lowers yield potential this summer.

Topics:

  • Market recap
  • Corn carryout tightens
  • Wet planting conditions
  • March NOPA report
  • Reports to watch

Market recap (changes on week as of Friday’s close):

  • May 2025 corn down $.08 at $4.82
  • December 2025 corn up $.03 at $4.66
  • May 2025 soybeans down $.07 at $10.35
  • November 2025 soybeans up $.06 at $10.31
  • May soybean oil up 0.51 cents at 47.86 cents/lb
  • May soybean meal down $3.80 at $295.80/short ton
  • May wheat down $.07 at $5.48
  • July 2025 wheat down $.09 at $5.61
  • May 2025 cotton up 0.43 cents at 66.32 cents/lb
  • December 2025 cotton down 0.07 cents at 68.44 cents/lb
  • May 2025 rough rice down $0.02 at $13.485/cwt
  • September 2025 rough rice down $0.12 at $13.545/cwt
  • May WTI Crude Oil up $3.07 at $64.57/barrel

Weekly highlights:

U.S. retail sales in March surged to a 26-month high. Consumer product chains warn that it was a lot of panic buying ahead of anticipated U.S. tariffs on imports.

The National Oilseed Processors Association reported their members crushed 194.6 million bushels in March- down 3 million from expectations, but up 16.7 million bushels from the disappointing February value.

Again, this week crude oil stocks were higher (+21.6 million gallons) while U.S gasoline and distillate fuels were down 82.2 and 77.7 million gallons respectively. U.S. gasoline demand was flat week over week.

U.S. ethanol production fell to 298 million gallons matching a calendar year low. Ethanol stocks decreased 9.24 million gallons, but remain seasonally high.

Weekly export sales of grains and oilseeds were mixed. Corn sales of 61.5 million bushels are 2.5 months high, soybean sales of 20.4 million bushels are a six-week high. Grain sorghum and cotton export sales were average. Wheat and rice sales were somewhat disappointing.

U.S. cattle on feed as of April 1, 2025 was down 1.6% year over year- nearly matching expectations. Placements and marketings in March at +5.1% and +1.1%, respectively were both slightly higher than expected.

Open interest in futures and options positions of grains and oilseeds fell 4% week over week. Producers and merchants were net sellers expanding their short position while money mangers were net buyers of 208,757 contracts- decreasing their short position.

U.S. export inspections were bullish for grains and neutral to bullish for oilseeds for the second straight week. Corn and wheat inspections came in above all expectations at 67.0 and 18.7 million bushels, respectively. Soybean inspections were as expected at 20.2 million bushels.

U.S. corn planting was 4% this week- a little behind the 5% average for this time of year and behind the 6% trade expectation. U.S. soybean planting is at 2% matching the 2% on average but also behind the 3% expected in pre-report expectations.

U.S. winter wheat conditions were 47% good to excellent- down 1 point from the week prior but matching trade expectations. The value compares to 55% good to excellent this time last year.

Weed Response to “Burndown” Herbicides

In no-till corn and soybean fields, it is essential to apply herbicides with foliar activity before crop emergence to control existing weeds. Depending upon the herbicide approach used in the field for that year, herbicides used to control weeds at planting may include glyphosate or paraquat. Use of herbicide combinations in burndown treatments is justified in most no-till fields, due to the variety of winter annual weeds present. Consider fall herbicide treatments in fields that are heavily infested with such species as chickweed, marestail, dandelion, wild carrot, and poison hemlock.

Click here for Burndown table

Weekly Commodity Market Update

Brownfield’s Weekly Commodity update featuring former OSU Extension Ag Economist Ben Brown.  This week Will and Ben review the latest USDA acreage and stocks numbers and take a look at what Trump’s reciprocal tariffs mean for agriculture.

Topics:

  • Market recap
  • USDA acreage numbers
  • USDA stocks report
  • Trump administration tariff actions
  • Reports to watch

Market recap (changes on week as of Friday’s close):

  •  May 2025 corn down $.11 at $4.53
  • December 2025 corn down $.09 at $4.42
  • May 2025 soybeans up $.14 at $10.23
  • November 2025 soybeans up $.22 at $10.29
  • May soybean oil up 3.15 cents at 45.16 cents/lb
  • May soybean meal down $6.80 at $293.50/short ton
  • May wheat down $.30 at $5.28
  • July 2025 wheat down $.32 at $5.42
  • May 2025 cotton up 1.63 cents at 66.90 cents/lb
  • December 2025 cotton up 1.43 cents at 70.09 cents/lb
  • May 2025 rough rice up $0.095 at $13.515/cwt
  • September 2025 rough rice up $0.10 at $13.755/cwt
  • May WTI Crude Oil up $0.91 at $69.28/barrel

Weekly highlights:

Consumer confidence dropped in March to 92.9, down 7.2 points from 100.1 in February. This is the fourth consecutive monthly decline.

Personal incomes were higher than expected in February while spending was slightly less. The PCE index at 0.3% matched expectations and the prior months increase signaling prices remain stubborn.

Energy stocks were largely down week over week. Crude oil minus the strategic petroleum reserve was down 140.3 million gallons, gasoline down 60.7 million gallons, and distillate fuel down 17.7 million gallons.

US ethanol production decreased to 310 million gallons- down from 325 million gallons the week prior and matching the same volume last year. US ethanol stocks increased 32.6 million gallons.

Weekly grain and oilseed export sales were largely as expected, but mostly down week over week and recent volumes. Corn sales- 49.9 million bushels, soybean sales-12.4 million bushels, wheat- 3.7 million bushels, rice- 2.2 million hundredweight, and cotton- 89,000 bales.

Open interest in futures and options of grains and oilseeds was up 0.3% week over week. Producer and merchants decreased their net short 109,703 futures and options contracts. Money managers increased their net short 108,996 contracts.

USDA released grain stocks as of March 1- grain stocks were nearly as estimated across the board. Corn and rough rice stocks were down year over year, while soybean and sorghum stocks were up year over year.

USDA reported farmers intend to plant 95.3 million corn acres, 83.5 million soybean acres, 6.09 million soft red winter wheat acres, 9.87 million cotton acres, and 2.9 million rice acres.

Weekly grain and oilseed export inspections were relatively strong this week. Corn exports of 63.6 million bushels were bullish coming in above all pre-report expectations. Soybeans, grain sorghum, and wheat exports at 29.1, 0.9, and 16.0 million bushels were at the top end of expectations.

That’s “a lotta” Corn

Source: USDA

Nationally, corn planted area for all purposes in 2025 is estimated at 95.3 million acres, up 5 percent or 4.73 million acres from last year. Compared with last year, planted acreage is expected to be up or unchanged in 40 of the 48 estimating States.

Ohio farmers intend to plant less corn and more soybean acreage in 2025 than they did last year, according to Ben Torrance, State Statistician, USDA NASS, Ohio Field Office.
Ohio corn producers intend to plant 3.25 million acres of corn this spring, down 4 percent from last year. Ohio soybean acreage is forecast at 5.10 million acres for 2025, up 1 percent from last year. Hay harvested area for 2025 is estimated at 830 thousand acres, up 5 percent from 2024. This includes alfalfa, grain, and all other types of hay intended to be harvested for dry hay.

Winter wheat acreage for 2025 harvest is estimated at 570,000 acres, up 10 percent from the previous year.

U.S. soybean planted area for 2025 is estimated at 83.5 million acres, down 4 percent from last year. Compared with last year, planted acreage is down or unchanged in 23 of the 29 estimating States.

Nationally, all wheat planted area for 2025 is estimated at 45.4 million acres, down 2 percent from 2024. If realized, this represents the second lowest all wheat planted area since records began in 1919. The 2025 winter wheat planted area, at 33.3 million acres, is down 2 percent from the previous estimate and down less than 1 percent from last year. Of this total, about 23.6 million acres are Hard Red Winter, 6.09 million acres are Soft Red Winter, and 3.66 million acres are White Winter. Area expected to be planted to other spring wheat for 2025 is estimated at 10.0 million acres, down 6 percent from 2024 estimate. Of this total, about 9.40 million acres are Hard Red Spring wheat. Durum planted area for 2025 is expected to total 2.02 million acres, down 2 percent from the previous year.

Introducing FARMS: A Comprehensive Tool for Farm Transition Planning

Farm transition planning is an essential process for agricultural operations. However, identifying and tracking assets and resources and preparing for transition planning can present significant challenges for farm families. To assist with these tasks, Ohio State University Extension has developed the Farm Asset and Resource Management Spreadsheet (FARMS), designed to provide a structured approach to organizing farm transition information.

What is FARMS?

FARMS is an Excel-based resource designed to support farm families and agricultural professionals in collecting and systematically organizing all necessary information related to farm transition planning. Whether at the preliminary stage or already engaged in detailed succession planning, FARMS enables users to input and manage varying levels of data effectively.  See example screenshots below for further explanation.

What Information Does FARMS Collect?

Farms collects all the following information:

  • Family and beneficiary names and contact information
  • Bank accounts
  • Financial Accounts
  • Life Insurance
  • Business Entities
  • Real Estate
  • Personal Property
  • Farm Property
  • Debt information
  • Designations for executor, trustee, power of attorney, guardian

What Does Farms Do with the Collected Information?

FARMS uses the information provided by the user to do the following:

  • Help ensure assets are titled to avoid probate
  • Determine net worth and value of estate
  • Calculate estate tax liability
  • Allocate assets and net worth between spouses
  • Allocate assets among beneficiaries to determine how much each beneficiary will receive from the transition plan
  • Provide information that will be needed to complete wills, trusts and power of attorney documents.

How to Use FARMS?

Given its foundation in Excel, users should possess at least a basic familiarity with spreadsheet navigation. Training videos are available on YouTube to assist new users with becoming familiar with FARMS, explaining how to enter data and use the summary and analysis functions.  A link to the training videos is provided below. Additionally, OSU Extension occasionally provides training sessions for potential users.  It is recommended to review the training videos or attend a training session before using FARMS.

Who Should Use FARMS?

FARMS is suited for anyone involved in the farm transition planning process, from family members beginning their farm transition plan to professional advisors engaged in developing detailed transition strategies for clients.

Accessing FARMS

To begin using FARMS, interested users can download the file at the link provided below.  We request users complete an initial, short survey prior to downloading FARMS, as user feedback is important to the ongoing improvement of the spreadsheet.  FARMS is available at no cost due to the financial support of key partners including North Central Extension Risk Management Education and the National Agricultural Law Center.

Conclusion

FARMS offers a structured, organized approach to farm transition planning, allowing farm families and professionals to collect comprehensive, accurate information.  For additional information and to begin utilizing FARMS, visit Ohiofarmoffice.osu.edu and discover how FARMS can positively impact your farm’s transition planning efforts.

Links for FARMS

Training Videos are available here: https://www.youtube.com/@osufarmoffice

FARMS can be downloaded here: https://farmoffice.osu.edu/farmsspreadsheet

Upcoming FARMS Online Training Courses

Click on registration link to register for the course.

April 7 @ 10:00 am:   https://osu.zoom.us/meeting/register/oJmnwm-VQx6XjqvBh7J0aA

April 16 @ 10:00 am:  https://osu.zoom.us/meeting/register/iY9cLoJeQwS0rUHkHr3DpA

April 23 @ 1:00 pm:  https://osu.zoom.us/meeting/register/vT_-X56FQQqBT63fKUQW4g

May 2 @ 3:00 pm:     https://osu.zoom.us/meeting/register/KmbdTjq2SryLkYNOaevp3Q

Ohio Farm Resolution Services

Ohio has over 76,000 farms and 13 million acres of farmland.  In such a large and diverse industry, conflicts commonly arise that can lead to disputes, litigation, and appeals.  Ultimately, these conflicts can cause harmful effects that threaten the viability of Ohio agriculture.

The goal of Ohio Farm Resolution Services at The Ohio State University (OFRS) is to cultivate solutions to the conflicts that impact Ohio’s farms and farm families.  Established in October of 2023 with funding from the USDA Farm Service Agency’s Certified Mediation Program, OFRS serves Ohio agriculture with a three-pronged approach to helping resolve farm conflicts that will provide:

  1. Educational resources on Ohio farm conflict issues.
  2. Conflict resolution and consultation services by OSU Extension legal and farm management specialists.
  3. Formal mediation services by trained mediators.

What issues will we cover? The types of issues OFRS will address include:

  • Family communication
  • Farm transition planning
  • Business entities/ practices
  • Energy leases
  • Farm leases
  • Zoning
  • Land Use
  • Labor
  • Neighbor issues
  • Lender/creditor
  • Property disputes
  • Farmland drainage
  • Crops/Agronomics
  • USDA/ODA appeals
  • Estate disputes
  • Other farm related issues

If you have a farm conflict issue we can help you with now, please e-mail program director Robert Moore at moore.301@osu.edu.

Weekly Commodity Market Update

Brownfield’s Weekly Commodity update featuring former OSU Extension Ag Economist Ben Brown. This week Will and Ben look at the growing competition in South American soybean production and emerging export opportunities.

Topics:

  • Market recap
  • Black Sea wheat outlook
  • Chinese soybean demand
  • South American soybean production
  • Corn export opportunity in Japan
  • Reports to watch

Market recap (changes on week as of Friday’s close):

  • May 2025 corn up $.06 at $4.64
  • December 2025 corn flat at $4.51
  • May 2025 soybeans down $.07 at $10.09
  • November 2025 soybeans down $.11 at $10.07
  • May soybean oil up 0.42 cents at 42.01 cents/lb
  • May soybean meal down $5.60 at $300.30/short ton
  • May wheat up $.01 at $5.58
  • July 2025 wheat up $.01 at $5.74
  • May 2025 cotton down 2.1 cents at 65.27 cents/lb
  • December 2025 cotton down 1.32 cents at 68.66 cents/lb
  • May WTI Crude Oil up $1.41 at $68.37/barrel

Weekly highlights:

US housing starts at 1.50 million exceeded expectations of 1.38 million and the 1.35 million in January.

The Federal Reserve decided to keep interest rates unchanged this week at a range of 4.25% to 4.5%, citing increased economic uncertainty and lowering its growth forecast for the year.

US crude oil stocks were up 73.3 million gallons, while gasoline and distillate stocks were down 22.1 and 118.1 million gallons. Implied gasoline demand was down 4% week over week, but still up 1% from the prior four-week average.

US ethanol production increased to an impressive 325 million gallons- up from 312 million gallons last week and 308 million gallons this time last year. Ethanol stocks were down 33.6 million gallons week over week but still 7% higher than the five-year average.

Weekly grain and oilseed export sales were mixed- corn sales were again strong at 58.9 million bushels. However, soybean export sales of 13.0 million bushels fell below all expectations Wheat sales were especially disappointing at net cancelations of -9.1 million bushels- 20 million bushels below the most bearish estimate.

Open interest in futures and options of grains and oilseeds was up 1.3% week over week. Producer and merchants decreased their net short 8,793 futures and options contracts. Money managers increased their net short 43,637 contracts to -205,435 contracts.

Weekly grain and oilseed export inspections were neutral to bullish on the week. Corn and soybean shipments of 57.6 and 30.2 million bushels, respectively were toward the top end of expectations, while wheat shipments of 17.8 million bushels topped all pre-report expectations. There were no grain sorghum inspections.

Spring Nitrogen Recommendations for Winter Wheat

Winter wheat is beginning to show signs of green-up (Figure 1). Nitrogen fertilizer should be applied to winter wheat between green-up and Feekes growth stage 6. (If you need a reminder on how to assess if wheat is at Feekes GS 6, see this video: https://www.youtube.com/watch?v=D_f3VrqzV5c)

Nitrogen applied too early has the potential to be lost since wheat will use little N until after jointing. Urea-ammonium nitrate (UAN) or 28% has the greatest potential for loss and ammonium sulfate the least. Urea will have little potential for loss as long as it does not volatize. No stabilizer will protect the nitrate component of UAN, which is roughly 25% of the total N in UAN at application time.

Wheat fertility guidelines follow the Tri-State Fertilizer Recommendations for Corn, Soybean, Wheat, and Alfalfa (available here: https://extensionpubs.osu.edu/search.php?search_query=Tri-state&section=product). Spring N rates depend on wheat yield potential (Table 1). If you prefer to be more specific, the following equation may be used for mineral soils, which have both 1 to 5% organic matter and adequate drainage:

N Rate = (1.33 x Yield potential) – 13

As a producer, you can increase or reduce your N rate by changing the value for yield potential. Thus, a realistic yield potential is needed to determine the optimum N rate. To select a realistic yield potential, look at wheat yield from the past five years. Throw out the highest and lowest wheat yield and average the remaining three wheat yields. This three-year average should reflect the realistic yield potential.

No credit is given for previous soybean or cover crops, since it is not known if that organic N source will be released soon enough for the wheat crop. The Tri-State Fertilizer bulletin recommends that you subtract from the total (spring N) any fall applied N. We recommend taking no more than a 20 lb/A credit even if you applied a larger amount. Whether you deduct fall N depends how much risk you are willing to take and your anticipated return of investment from additional N. Based on the equation above and deducting 20 lb from a fall application, a spring application of 100 lb N per acre would be recommended for a yield potential of 100 bu, 90 for 90 bu potential; and 70 for a 80 bu potential.  Nitrogen rate studies at the Northwest Agricultural Research Station over the past 20 years have shown the optimum rate varies depending on the year. However, averaged over years, yield data from these studies correspond well with the recommendation equation given above. These studies have also shown apart from one year, yields did not increase above a spring rate of 120 lb N per acre.

Wheat generally does not benefit from a nitrification inhibitor since temperatures are relatively cool at application time and the application is made to a growing crop, this is especially true as the crop approaches Feekes GS 6. However, urea may benefit from a urease inhibitor (products containing NBPT) if conditions for volatilization exist for several days after application. These conditions would include an extended dry period with warm drying temperatures (risk increases with temperatures above 70°F) and evaporating winds. Urea applications need at least a half inch rain within 48 hours to minimize volatilization losses unless temperatures remain relatively cool. The urease inhibitor will prevent volatilization for 10 to 14 days with the anticipation of a significant rainfall event during this time.

ESN or polymer coated urea will reduce the potential for N loss from leaching, denitrification, and volatilization. Since these conditions are unlikely to occur in most years, it may not be economical to use this product. Cool weather may prevent the timely release of N from ESN, so if ESN is applied, it should be mixed with urea or ammonium sulfate and be no more than 60% ESN.

A split application of N may be used to spread the risk of N loss and to improve N use efficiency. However, Ohio State University research has not shown a consistent yield increase from this practice compared to a single application after green-up and multiple applications are more costly compared to a single application. In a split system, the first application should be applied no sooner than green-up. A smaller rate should be applied with the first application since little is needed by the crop at that time and the larger rate applied closer to Feekes GS 6.