Business Transition Strategies For The Multi - Married
This information is for hypothetical and educational purposes only and should not be considered specific tax, legal, investment or planning advice, which will only be provided on a personalized basis. These are not actual clients, this is for educational purposes only. This information is based upon on our understanding of current laws, which is subject to change.
1. In the event of death, provide for his wife and child in a manner consistent with their current lifestyle.
2. In the event of death, provide for his adult children from previous marriage in a moderate amount.
3. Maximize the value of his business through diversification of the customer base and expansion of the revenue stream.
2. Mr. Multiple’s overall situation was quite typical of what we see among small business owners. He had given time and attention to identifying an age at which he wanted to slow down but had not given sufficient time and attention to creating a comprehensive, all-inclusive retirement plan.
2. Mr. Multiple should change beneficiary designations within his retirement plans to more closely align with his overall estate planning strategies.
Mr. Multiple chose to implement all of our recommendations. Today his net worth is over $17 million; we were able to move the business real estate into an LLC and house over $5 million of seconded insurance to pay the taxes in the LLC.
Mr. Multiple’s son is gradually expanding his role in the business in anticipation of purchasing it and running it himself at some point in the future. The overall estate plan includes provisions for this sale at an advantageous price to the son, while also providing some cash payments to Mr. Bolton’s other children upon completion of the sale. Finally, Mr. Multiple has purchased a vacation property and is gradually increasing the amount of time spent there.
Investing involves risks, including loss of value. Gifts do not receive a step-up in basis. As such, heirs may be subject to capital gains taxation. Other limitations and restrictions may apply not identified above.