No doubt your business exit will be a complex transaction. Without the proper planning and drafting of the associated legal documents the negative tax, business, and legal consequences may be far-reaching. A well designed exit strategy starts with your goals and executes your exit plan with the necessary consideration to the business, tax, and legal components of the available strategies. Caution must be exercised because too many attorneys practice “This is the way we do it” legal advice. Their methods may have adverse tax consequences and impact the amount you pocket from the transaction and on the business’ cash flow.…
Author: Timothy Foster
Why is an Asset Protection Strategy Critical for Your Business?
Most business owners that I meet are surprised to learn that just because they operate their business as an incorporated entity (S-corp or C-corp) or an LLC, their business and personal assets are NOT “automatically” and “fully” protected from business or personal litigation. Ignorance is bliss, getting a hard reality check from the hungry litigators in an overpopulated legal system is a difficult lesson to learn. Take note – if you’re not prepared – the legal system can be brutal and unforgiving. We get too many phone calls from business owners who are facing litigation from an event that’s already…
Why Does Your Family Business Need a Succession and Exit Strategy?
Many owners of a privately held business want to transfer their life’s work – the business – to a family member. There are many tax, legal and other considerations to consider. You want to do what’s best for your family but also should not lose sight of your own goals and objectives. And, there may be delicate family relationship issues to consider. In such a transaction, an intra-family business transfer these factors should be considered. Benefits of a Family Business Succession Plan Minimize taxes to both generations and the business itself Maximize wealth building and retirement income Plan for…
Tax Planning is a Critical Component of an Exit Plan
Consider This Typical Scenario: Business owner commits decades building a profitable and successful business. As you know, those years have been filled with personal and family sacrifice, long hours, sleepless nights, and countless employee issues. That effort has produced a profitable and growing business, a loyal and well trained group of employees, and a consistent customer base. Without realizing it, one of the other and perhaps most costly sacrifices that Business Owner made was NOT utilizing advanced tax planning to use the business as a tool for properly building Personal Wealth and Retirement Planning. It really wasn’t Business Owners fault;…
The 2018 Tax Law Changes – The 20% Pass Through Deduction
The Tax Cuts and Jobs Act (TCJA) effective for Tax Years beginning 2018 includes a new code section 199A. A business that utilizes proactive, strategic tax planning should realize a windfall of additional tax savings in 2018 and future years, if and only if, YOU make these new tax laws work for you and your business! The new pass-through deduction is designed to benefit pass-through businesses including partnerships, S-Corporations, sole proprietorships, and LLCs that elect to be taxed as one of these three. Most of the calculations take place at the business level and are then passed on a pro-rata…