If you’re thinking of exiting the dairy business, Glenn Rogers, University of Vermont Extension professor emeritus and ag consultant, offers seven things to keep in mind:

1. Income taxes must be paid. Some of the depreciation taken over the years may have to be recaptured in the year of sale — whether you get the money or not. Your tax preparer can determine how much.

2. Also look at the capital gains rates versus ordinary income tax rates. There’s a huge difference. Some dairy farmers opt to keep those bred and "close up" heifers until they freshen the next year, just to go from the high tax rate to a lower one.

3. How you structure the farm sale has a huge impact on your total financial gain. Take time to think through this process. 

4. There’s a balance to achieve regarding selling your home.  Like most, you’ve invested a lifetime there, as has your spouse and children.

5. The question as to whether to have an auction, or to sell the property, cattle and equipment all to one (or many) via private sale is huge.  It’s not something to take lightly.   Do lots of planning on the auction before you sign any contracts.  Timing, location, presentation and a whole host of other things must be considered prior to selling via an auction.  

6. Renting the farm is a way to gradually exit the operation as you age. We generally still get to live in our home. We get to see the fields and perhaps the facilities being worked. We often can participate in the cropping activities of the lessee as we slow down from the rush and daily grind. We can now "slow down" a bit and perhaps take a few weeks to enjoy the fruits of our labors and help someone else as they proceed with their vocation.

7. Whether it’s just the cattle and equipment or the whole farm, take some time for yourself. Don't take too much time, but get away from the farm for a short time. Never stop working, learning or exercising. It’s key and highly recommended. The process of selling the animals, the equipment and the farm is emotionally, physically and mentally demanding. The drain on your body is huge. So slow down a bit; get away a bit. But fill the void with other activities.