|
Celebrating
our 25th Anniversary
When there’s no heir apparent
Planning for business succession is more difficult if there are no
family members, co-owners or key employees to step into your shoes. In
such cases, you must find another exit strategy.
Two options are to sell your business to outsiders or to liquidate. A
sale is typically preferred — for both financial and emotional reasons.
An easy sell might be to one of your competitors. Often similar
companies, or those in related lines of business, will view your company
as a good expansion vehicle. Evaluate whether the business would
generate more proceeds if sold intact, or broken down in asset groups.
Your business could also be acquired in a merger-type of transaction,
which could leave you with stock in the acquiring company.
In certain circumstances, liquidating might be your best option. For
example, if you have valuable equipment but your business is so unique
that it’s unlikely a successor can be found, selling the business may
not be possible. In this case, you could sell the assets and liquidate.
Assets sold before liquidation could include equipment and any
intangibles, such as trade names, trademarks, patents, copyrights or
other intellectual property rights.
|
|
|
|
Share your assets
How to provide for children from a previous marriage and
your spouseFor
most families, an estate plan is indispensable. It enables
you to ensure your spouse and children are financially
provided for and your wishes are carried out not only after
your death, but also in the event you become incapacitated
during your life. Having documentation in place also helps
you share as much of your wealth as possible with your loved
ones while minimizing the tax bite.
Estate planning can be complex even in the most traditional
families. But today, second and third marriages are
increasingly common, complicating the process even further.
If you have children from a previous marriage, failing to
plan can lead to unexpected — and unwanted — results. This
article explores estate planning options such as creating a
qualified terminable interest property trust or irrevocable
life insurance trust.
Read more
Fragile transactions
Handle shareholder loans with care
Shareholders of closely held
corporations often look for ways to take money out of the
company without triggering tax liability. C corporation
shareholders, in particular, are concerned about double
taxation: Earnings are taxed once at the corporate level and
again at the individual level when they’re distributed to
shareholders as dividends. To avoid double taxation, C
corporations usually pay out as much as they reasonably can
to shareholder-employees as deductible compensation. Some
corporations choose another route by making loans to their
shareholders. Because of this, the IRS is suspicious of
shareholder loans. This article details the importance of
documenting shareholder loans to avoid having them be
treated as constructive dividends and being hit with back
taxes, interest and penalties. (Case cited in article is:
Teymourian v. Commissioner, TC Memo 2005-232.)
Read more
There’s no better time than
the present to plan your future
How succession planning can benefit your business
You’ve spent a lifetime
building a successful company, and now you’re looking
forward to the freedom of retirement. To ensure a worry-free
exit from the workplace, you need to plan for the
continuance of your company. This article takes you through
the planning process — from determining the business’s value
to considering your retirement goals and income needs. A
helpful sidebar offers insight on disposing of a business
when there’s no “heir apparent.”
Read more
|
Not your run-of-the-mill retirement planning ideas
You work hard to ensure your
long-term financial security. But is your money working
just as hard for you? This article takes a look at some
retirement planning ideas that you may not have
considered. For example, taxable investments (stocks,
mutual funds and bonds) are typically taxed at lower
rates and give you easier access to your funds should
the need arise. (Funds within an IRA or 401(k) are taxed
as ordinary income when withdrawn.) The article also
covers compensation arrangements that can help ensure a
more comfortable retirement and how to make wise choices
when designating beneficiaries.
Read more |
|
