Winery Estate Planning: 4 Ways to Protect Your Vineyard, Family, and Business Legacy

Estate Planning Strategies Every Winery Owner Should Consider for Long-Term Success

Our winery owner clients will tell you that having a plan in place is key, and we have a passion for planning. Our office represents business owners across a range of industries, but working with winery owners is a unique pleasure. Here are four tools we have incorporated into the estate plans of our winery owners that any business owner or family should consider.

Looking for an experienced estate planning attorney in Salem OR? Contact Collier Law today to help protect your winery, your family, and your legacy.

1. Natural Resource Exemption

Oregon has the lowest estate tax exemption and the third-highest marginal tax rates for death taxes in the United States. However, winery and vineyard owners have a unique tool that may increase their exemptions at death to $15 million for qualifying natural resources. Winery operations and vineyards fall under that agricultural natural resource exemption. If the winery remains in the family after the owner’s death, the additional exemption may apply.

2. Remarriage Protection

Running a vineyard is hard work and a labor of love. Winery owners envision their vines thriving long after the passing of the winery owners. After the death of a spouse, remarriage may not be at the top of mind. In 1996, the San Diego Widowhood Project found that 61% of men and 19% of women had either remarried or become involved in a new romantic relationship within about two years of losing a spouse. Remarriage is a very real possibility, and planning for it is critical. Remarriage protection might include a requirement that the surviving spouse sign a prenuptial agreement protecting the winery and ensuring that it could not pass to a new spouse through divorce or death. If a new marriage happened without that prenuptial agreement in place, a child or neutral third party might take over management of the business and the funds from that business to ensure they were not inadvertently or intentionally rerouted to the new spouse.

3. Asset Protection for Children

If one or more of your children plan to take over the winery after you are gone, you need protection in place for those children. Placing the business ownership inside a lifetime asset protection trust will insulate it from external threats such as a child’s divorcing spouse, lawsuits, judgments, bankruptcy, and foreclosure. The child can continue to manage their own funds so long as there are no looming risks or hand over management of their share to a neutral third party if there is a looming risk. Regardless, the assets are protected and continue to benefit the child for the duration of their life.

4. Decanting Tools

Decanting isn’t just for wine! Upon the death of the creators of the trust, the trust becomes irrevocable. It cannot be changed. However, on occasion, changes in the law or circumstances may require changes nonetheless. Decanting tools allow us to “pour” the assets of an irrevocable trust into an updated irrevocable trust. This might be done to address changes in the law, creditor issues, or change the terms of distribution to better support a beneficiary. Flexibility in a changing world is important, and decanting offsets our lack of a crystal ball to tell us what the future holds.

We love meeting our winery families in their tasting rooms as well as at our office. Our goal is to ensure the business continues to thrive and wine continues to flow for years to come.

Secure your family’s future with Collier Law, the trusted estate planning attorney in Salem OR for winery owners and business families.