Estate planning can be a complicated, and sometimes confusing process. I would recommend sitting down with an attorney, and possibly a tax expert, to discuss the options available to you before proceeding with either of the options you mentioned. You want to ensure that the estate receives all available tax benefits and that the beneficiaries do not incur any unnecessary financial/tax obligations. If the father has any medical conditions that may require treatment down the road, he may want to look into a trust that would remove the property from his estate now but not transfer to the children until his death. If the properties remain in his name and he requires medical treatment later on, medicaid can, and likely will, place a lien on the property to recover any funds expended on the father's behalf.
Both may be bad ideas if the transaction results in a gift. When a person receives a gift they get a carryover basis in the property. This would be a problem if dad has bought the property a long time ago and it is worth a lot more now. If the property is transferred at death, then the recipients get a step up in basis to the date of death value. This will result in little or no gain if the farm is sold after his death. For more on gift issues see Gift Giving: Tax Advantages at the following link: http://www.sjfpc.com/gift_taxes_planning.html. Also read IRS Checking Real Estate Transfers For Unreported Gifts for further perspective at http://www.sjfpc.com/IRS_Auditing_Real_Estate_Gifts_Tax_Rules_Returns_Form_709.html
Now there are other practical and business consideration that you raise that may be addressed via some legal vehicle that you mention, but you need to get dad with an estates attorney to discuss this in more detail and to look at what is best for your particular facts and family situation.
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Both answers given were excellent advice. You may think you have asked a simple question but you have not. How this is structured, aside from the tax consequences also matters from a "power" perspective. Depending on how a trust is set-up, it could actually provide your father with more control over the farm, until he passes, than a corporation. Of course, a trust is generally less flexible than a corporation. Apples and Onions and the type of scenario that requires extensive analysis and consultation and cannot be answered on this website.
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I agree with all the comments made so far. Basically, you asked a loaded question which is not easily answered, because it depends on many factors in your, your father's and your siblings' situations. I should note that you almost never want to place land in a regular C corporation because of double tax potential. If you end up placing the real estate in an entity for one or more reasons in this case, it will more than likely make sense to contribute the property to a limited liability entity of some type, likely either an LLC or LLLP, with a possibility of using a S corporation. However, this situation starts and ends with this being an estate and tax planing matter for your father and this includes the on-going operations of the farm property and eventual succession. I highly recommend that legal assistance is obtained in this regard. Good luck.