Learn the necessary considerations to define, execute, and implement an appropriate succession plan for a client.
Whether a business owner is ready or not to move on, the manner to effectuate a successful transfer is based on a similar identifiable process. This topic provides an outline of the considerations necessary to define, execute, and implement an appropriate succession plan for a client.
The process begins with a discussion of the transferor’s motivations when transferring property, whether by choice or due to unforeseen events, what to have in place in the event of a desired transfer or a forced transfer, how to value the business for transfer, and concludes with an examination of the critical tax rules implicated by the transfer.
Lastly, the method of transfer can be affected by a number of factors. We will discuss which type of transfer works best in which situations, how to assure the business owner and their family can financially and personally weather the transfer, and what the estate planning and tax consequences are of a properly or improperly executed succession plan.
Learning Objectives
- You will be able to identify what information is necessary when a client is considering transferring business interest.
- You will be able to discuss what to prepare or have ready if a transfer occurs by unforeseen events (death or disability).
- You will be able to describe different types of valuations and how they affect a transfer; understand when and why to engage in a valuation of the business.
- You will be able to explain how to assess applicable tax rules for transfers and the financial implications of the transfer.
Agenda
Obtain Initial Information
- Reason or Motivation for Transfer
- Voluntary vs. Unforeseen
- Review Structure and Governing Documents
- Rules and Restrictions on Transfers
- Clean up Corporate Records and Organize Financial Statements
Prepare for Transfer
- State and Local Compliance
- Income and Sales Tax
- Required Regulations and Registrations
- Privacy and Non-Disclosure Agreements
- Timing of Preparation, Negotiations, and Closing
Valuation
- Timing and Aging of Valuation
- Type of Valuation
- 409A
- Estate or Gift Tax Valuation
- Fair Market Value
- EBITDA/EBITA
- Discounting
- Minority Interest or Minority Control
- To Trusts for Benefit of Family Members (IRC 2702)
Methods of Transfer
- Purchaser
- Internal vs. External
- Family
- Business Associate/Partner/Employee
- Funding
- Sale Only
- Gift Only
- Part-Gift/Part-Sale
- Advance Planning
- Buy-Sell Agreements
- ESOP vs. Buyout
- Life Insurance
- Promissory Notes
- Trusts
- IDGT
- GRAT
- SLAT
- ILIT
Conclusion
- Update Estate Documents as Necessary
- File Final Tax Returns
Speakers
Jennifer V. Abelaj,
Davidoff Hutcher & Citron LLP- Senior counsel at Davidoff Hutcher & Citron LLP
- Practice emphasizes all aspects of trusts and estates, not-for-profits, and taxation
- Conducts regular seminars and workshops on trust administration, business succession planning, creation of not-for-profit and advanced estate planning techniques
- Author of several publications and quoted for expertise in taxation in: The New York Times; Bloomberg; Tax Notes; Law360
- Membership of the New York State Bar Association; New York Women’s Bar Association
- J.D. degree, St. John’s University School of Law; B.S. degree, Fordham University, Gabelli School of Business; Certified Public Accountant, New York State
- Can be contacted at jva@dhclegal.com, 646-428-3276, on Twitter® @JVATaxnLaw or at www.linkedin.com/in/jenniferabelaj
Nina Stillman,
Handler Thayer, LLP- Senior counsel at Handler Thayer, LLC
- Seasoned estate planning, probate, and business attorney focused on wealth preservation and transfer as well as taxation issues for family offices, ultra-high-net-worth business owners
Who Should Attend
This live webinar is designed for attorneys, presidents, vice presidents, financial and estate planners, developers, real estate professionals, and accountants.
