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Buy Sell Agreements a Key Component of Succession Planning

July 28, 2015

Filed under: Estate Planning — Neel Shah @ 9:15 am

Death or disability can suddenly and negative impact an unprepared business. Even a gradual retirement can hurt the potential for success with continuity and management by successors in the future. That’s where a buy-sell agreement comes into play to help ensure stability and cash flow while the retiree’s buyout was funded. shutterstock_238721092

Sale to a third party might be considered. A redemption agreement may be a good choice for allowing an entity to purchase the business. A cross-purchase agreement, however, will allow individual owners to make their purchase. Redemption is a simple process, but a downturn in business could allow creditors, the IRS, or the state access to decisions or even funds.

Cross purchase agreements carry the necessity for each owner to insure his partners, all of whom might have their own money needs beyond the general concern for the ongoing business needs. Insurance policies might also be used to fund the buyout, putting the funds in an LLC to ensure that funds are being used by the actual purpose of the funding buyout.

Planning Ahead for Healthcare Decisions

July 27, 2015

Filed under: Estate Planning — Neel Shah @ 9:15 am

There are two important keys for factoring in healthcare decisions late in life. These are the living will and a healthcare proxy. They not only provide directions for someone’s care, but they also keep decisions from being made in expensive court proceedings. shutterstock_237162238

A living will clarifies a person’s health care decisions, but states do vary in how customized such a document can be. As a general guideline, these documents address the person’s wishes if he or she was to be diagnosed with a terminal illness or sudden in a vegetative state.

A trusted agent can be used to help manage a living will and healthcare proxy. The proxy allows for either very specific declarations regarding care or general guidelines that an agent might consider in the process of administering what he or she plans to do.

A special needs trust might also be used for management by an agent to supplement any public benefits and coordinate for future planning with Medicaid. If you have questions about how to use these documents appropriately and the important process of selecting your agent, contact us today. A consultation can help you learn about potential estate planning tools that will benefit you now and in the future.

Estate Lessons From Tony Soprano

July 24, 2015

Filed under: Estate Planning — Neel Shah @ 9:15 am

While his death happened two years ago, there are plenty of estate planning lessons to be learned from the estate of Sopranos star James Gandolfini. In light of the fact that his death is in the recent past, it’s a good reflection of how long documents and planning tools take to wind through the court process. shutterstock_124910048

Disposing of 80 percent of his assets through his will left behind large estate taxes, even though a revocable trust would have avoided some of these penalties. Such a trust could have been used in conjunction with a “pour-over will”, where all assets are transferred into the trust.

Trusts for his children could have been structured as lifetime distributions, avoiding the challenges associated with immaturity potential. If this has been done, the lump sum of money would have been transferred to the children in their early 20s.

His foreign property was left to one child within his will, but it could be overridden with Italian inheritance laws. This could lead to potential will contests and no funds being present for considerations of upkeep.

To help ensure that your estate is planned for appropriately, contact us today to set up a consultation.

Estate Planning: Are Tax Free Savings Accounts Rewriting Rules?

July 23, 2015

Filed under: Estate Planning — Neel Shah @ 9:15 am

Tax-free savings accounts, which were first introduced in 2009 and still in existence with relatively high contribution limits, provide for the smooth passage of assets upon death. This process, when done properly, also helps individuals avoid probate court. shutterstock_232260391

Individuals can pass on to a successor holder (if the other person is a spouse or common law partner), or a beneficiary. The success holder path is easier to follow, since the funds in question would simply slide over with no change in status. With a beneficiary, however, the money deregisters at the time of death and is then transferred into a non-sheltered account in that individual’s name.

If an account has a designated successor holder and beneficiary, the former situation precedes the latter. Designations can be changed at any time, and a side feature of the account is that beneficiary names and account details stay private, unlike provisions inside a will.

If you’re curious about tax free savings accounts and other planning vehicles that can assist in putting some money aside, set up an appointment today to come talk to us.

Asset Protection: Few Business Owners Have It, Although Many Should

July 22, 2015

Filed under: Estate Planning — Neel Shah @ 9:15 am

A recent survey of 513 business owners indicated that more than 400 of them were concerned about the possible implications of a lawsuit or divorce. Despite these broad concerns (which are certainly fair, given the litigious environment we live in and high divorce rates common across the country), only fifteen percent of those surveyed had some kind of plan in place. Of that group, 3 out of 5 had no idea where to get started. shutterstock_232326355

In the world we live in, asset protection is not just a recommendation- it’s a necessity and worthwhile for managing overall risks. Sufficient liability and property insurance is a key starting point for these goals. Consult with an asset protection specialist to learn about other avenues for making assets difficult for individuals to reach in a lawsuit. The specifics of your plan will depend on your situation and your goals, but there are options that can help you reduce some of the fears and concerns related to asset protection.

To learn more about asset protection, contact us today for a consultation.

Tips for Succession Planning: Getting Out and Moving On

July 21, 2015

Filed under: Estate Planning — Neel Shah @ 9:15 am


There are plenty of stories about the challenges of moving on from a business when it’s time to leave, but there are also more positive stories about proven paths for successful business exits. One such example is that of Arbor Investments LLC in Michigan after the sale of 208 Arbor Drug Stores in 1998. shutterstock_261372998

The goal of the founder, Eugene Applebaum, was to generate enough wealth to expand philanthropy efforts. As part of this path, he opened up a family office and trained his two daughters to be the agents of change that would put his goals into action.

He trained them to think and then execute in 15 year cycles, including actions like disengaging from certain investments and entering into others (like a Compass Fund to help support other entrepreneurial projects). Even now, Applebaum’s teenage grandchildren are being included in the process in a way that allows them to experience and gauge interest in some kind of future with the firm.

Business succession planning is most successful when done in advance and with ample opportunity to give future generations or other involved stakeholders a chance to excel. Contact us today to learn more about business succession planning.

Beware of These Fraud Schemes Targeting Seniors

July 20, 2015

Filed under: Estate Planning — Neel Shah @ 9:15 am

Unfortunately, when it comes to fraud, there is a perfect storm targeting senior citizens. Many of the scammers who target this population are extremely crafty and have compelling stories and displays to make it look as if their operation is legitimate. Steering clear of these situations can be difficult; read on to learn more.  shutterstock_155217680

As a result of longer living and the risk of cognitive decline, there are challenges facing the elderly population when it comes to fraud schemes. One major concern has to do with financial abuse, which is frequently underreported. There is a large gray area associated with inheritance versus abuse, meaning that very few cases actually come to light involving such scenarios.

Many states have become active in putting forth “pause laws” that mandate waiting periods for financial transactions accomplished by anyone calling themselves an elder advisor. In addition, all states but New York require some kind of reporting of any potential abuse. The key to preventing these schemes, especially with regard to financial abuse, involves early communication with family members and the possible creation of a trust to generate an “invisible fence” around assets that can help cut down on outside access.

Planning Steps to Take Post Gay Marriage Ruling

July 17, 2015

Filed under: Estate Planning — Neel Shah @ 9:15 am

The Supreme Court’s recent decision has already had a big impact around the country, and it certainly influences the legal rights of same-sex couples with regard to taxes and spousal benefits. There are several different ways that this influences current planning. If you are planning to get married in light of the recent ruling, read on to learn about some of these critical impacts. shutterstock_167614421

The first factor has to do with healthcare. The spouse will now have priority in healthcare decision, a legal sticking point in the past. The spouse could also have a say in guardianship situations. Taxes are another way that couples may wish to evaluate their current decisions, since couples can now file as married on their state taxes.

There are other estate planning opportunities in light of this ruling, too. Survivorship benefits at the state level are now open, including plans like pensions. Special consideration of intestacy should be factored in, too, since spousal inheritance rules could apply if one partner passes away without a will.

Despite the fact that these changes will be happening across the country, it doesn’t mean that one size fits all. To discuss your family’s situation with an estate planning attorney so that your unique needs can be evaluated, contact us today at

Is the IRS Taking Aim At Estates?

July 16, 2015

Filed under: Estate Planning — Neel Shah @ 9:15 am

For many years, company owners have used LLCs and limited partnerships to pass on businesses to their heirs. Passing on these business interests might also be accompanied with a transfer of marketable securities wherein the partnership keeps control but the gift overall reduces assets and therefore the tax burden. shutterstock_245503636

This practice is now under scrutiny from the IRS because securities can be appraised and receive a discount, which reduces the amount of the gift and the tax associated with the transaction. This gifting methodology, which allows for those who have exceeded the single or couple lifetime gift exemptions, has been used by wealthy individuals for many years.

It looks like new regulations may be coming down the pike as soon as September, stretching beyond securities. These new regulations might look to eliminate or reduce tax reductions that are linked to privately-owned companies, too.

Using Asset Protection to Prevent Problems in the Future

July 15, 2015

Filed under: Estate Planning — Neel Shah @ 9:15 am

Asset protection is a term that is thrown around quite a lot in planning circles, and depending on who you talk to, the definition in use could be different. In general, however, there are two stages to asset protection. In the first stage, you evaluate all of the possible scenarios under which risks may expose an individual or a business to financial jeopardy. shutterstock_251170642

These risks can come from multiple different directions, but all of them can be very damaging. A divorce or an argument within a partnership can both be frustrating and unfortunate, but they can generate vastly different outcomes. Although it’s not always easy to plan for these situations, it’s at minimum a valuable exercise to determine where there is room for better asset protection planning.

Some attorneys choose to focus on asset protection, recognizing the amount of work that goes into building wealth. Exposing that wealth to risks can be devastating, which is why it’s recommended that individuals and business owners consider asset protection very carefully. If you need help determining where you could be facing risks, contact an asset protection attorney today.

Key Management Positions: Setting the Right Model for Succession Planning

July 14, 2015

Filed under: Estate Planning — Neel Shah @ 9:15 am

Succession planning is a complex process that involves the big picture of your business years down the road, but key to that success is finding the right people to take over main management positions. Where possible, it’s a good plan to have successors across the board prepared for next steps. shutterstock_179549198

Although the specifics will depend on each business, you should ensure that successors at each level are ready for promotion. Suggested numbers include preparing 80 percent of people for promotion, depending on who you think has the skillset to succeed in the higher role and how well that individual would work with other team members.

Finding committed people is critical, giving those individuals compelling reasons to buy into the future of the company. Take a look at their current job descriptions about accountability so that you can clearly and fairly evaluate these individuals. This helps set up the pathway for future achievement expectations and illumination of areas where those individuals are most likely to be highly competent.

From there, create individual development plans that include regular evaluation. The evaluation is a chance to check in again on commitment and allow for a relationship that builds back and forth, ultimately, increasing your support of that individual and his/her confidence in handling the job. Contact us at

Benefits of Selecting an Elder Law Attorney

July 13, 2015

Filed under: Estate Planning — Neel Shah @ 9:15 am

As more baby boomers are crossing into the retirement divide each day, the need for an elder care lawyer is only growing. Older individuals have many different challenges to contend with, chief among them being healthcare and estate planning. shutterstock_265829186

Good counsel with experience in elder care will be beneficial in many different ways, including disability and social security issues, asset transfer, long-term care, and estate and trust work. Finding someone with experience in the field ensures that all your questions are answered properly and that you feel confident about the future.

Before hiring an elder care attorney, ask about qualifications: how long has the attorney been focused on elder law? Will your case be handled by the individual attorney or a team? Is the attorney interested in building a relationship with you to help address all of your elder law concerns now and down the road? These are critical questions that should be answered at the outset of your interaction with such an individual.

Finding the right match for you is a mix of experience and personality. Since you may need assistance with numerous elder law issues over the course of the coming years, make sure you find someone you can trust who has an opinion you value.

Just How Important is the Trustee of an Estate?

July 10, 2015

Filed under: Estate Planning — Neel Shah @ 9:15 am

Placing an individual in the role of trustee for your estate is something that should be done with care. This person will serve as a fiduciary, remaining responsible for managing your assets. It’s important that the trustee and the person hiring such an individual understand that trusteeship is not a quick or simple job. This position requires energy, common sense, and willingness to focus on the finer details. shutterstock_70346920

When hiring a trustee, it’s important to be clear about all details and be willing to reconsider the relationship if life conditions of either party change over time. If you are not comfortable with an individual serving in this role, institutional trusteeship is one option.

Going this route means you’ll get unemotional expertise and likely experience in serving in such a role. This decision should only be made after you have consulted carefully with an experienced attorney who can walk you through the pros and cons of having an individual trustee versus an institutionalized one. Get our help at

Fast Facts on Medicaid Recovery and the Affordable Healthcare Act

July 9, 2015

Filed under: Estate Planning — Neel Shah @ 9:15 am

As a result of a federal law that became active in 1993, states were required to recover long-term care expenses for those aged 55 and over after an individual passed away. Each state also had the option to go after all health expenses, too. There were exemptions made for estates that included a surviving spouse, a child under the age of 21, or a household with a blind/disabled child of any age.

These Medicaid Estate Recovery Programs vary from state to state in terms of their specific requirements and the vigor with which collection is pursued- this is why it’s important to consult with a specialist if you have more questions. shutterstock_291062819

Implementation of the Affordable Care Act has three different impacts on these regulations, all of which potentially put higher numbers of estates under these guidelines. This includes the mandate that most Americans should obtain insurance, expanded Medicaid eligibility, and the elimination of asset evaluations to determine eligibility. Got questions? Reach out to us at

Business Valuation for the Purposes of Exit Planning: It’s a Priority Task

July 7, 2015

Filed under: Estate Planning — Neel Shah @ 9:15 am

One of the most important aspects of valuing a business is in the timing- you must have the will to do it now and carry this momentum forward. Even in times of feeling overwhelmed or burdened by day to day stress, unplanned events must be considered. shutterstock_248979157

In fact, in times of high stress it can become all the more frustrating to realize that you did not carefully plan for the future. Death or disability can come at any time, and not having thought in advance about how to deal with such challenges can prove very problematic for a business owner. Even when a key employee decides to leave the company, the impact can be felt throughout the business if you have not planning for these kinds of events before.

Even burnout can be challenging if you haven’t thought about bringing a successor in. Assembling a team to help you come up with a plan is an important part of the process. The return on your time in succession planning can be very rewarding, as any challenges faced in the future can be dealt with appropriately. Having these plans in place certainly makes business valuation easier. Contact us at

Asset Protection Tips: Legitimate Captives

Filed under: Estate Planning — Neel Shah @ 9:15 am

The IRS recognizes the legitimate business concern of creating a small and closely-held insurance company in order to cover some of the risk associated with various business entities. If the company is defined as a small one, the insurer does not have to pay any tax on underwriting income. Usually the definition of small means no more than $1.2 million in net written premium across a year. shutterstock_248252977

The originating company in this situation would receive a tax deferral due to the deduction of premium paid, while the insurer does not have to pay underwriting tax, either. The key to all of this is that the captive has to be structured as a legitimate insurer providing coverage at a reasonable cost. Possible risks could arise if the company were used to generate implausible coverage with extremely high fees or high premiums.

The structure of such a captive, and the management of it, should be done with care. This is to ensure the highest level of protection offered by such a structure. The use of captive insurance companies is something that has become increasingly popular, but it should always be done properly in order to maximize benefits. Contact us for more information at

The Dangers of Social Isolation for Elders

July 6, 2015

Filed under: Estate Planning — Neel Shah @ 9:15 am

As children grow older and leave the home, as retirement takes away much of the interaction with work contacts, and as the possible loss of a spouse impacts an elderly individual, being alone becomes the norm. Unfortunately, it can also be a dangerous problem if you don’t plan ahead for how you can stay socially involved with friends, family, and your community. shutterstock_152237090

As baby boomers age, it becomes much more likely that both parents and even friends pass away, which can lead to feelings of extremely loneliness and even depression. When these major life events alter how often you’re interacting with others, it’s important to take steps to build a support structure. For many, this means getting involved in community organizations like a church.

There are many benefits to regular social interaction, including better self-confidence, happiness, and an improved overall outlook on life. Other family members can be a critical part of the support structure you build, but it can be very beneficial to establish regular habits with community organizations. Whether it’s getting together for fellowship or volunteering in some capacity, it can be very advantageous to find other friends and peers to network with. Building a routine that involves regular interaction with these kinds of groups can also help to combat loneliness.

Asset Protection Tips: How to Handle Cutting Off Alimony if Your Spouse Has Moved On

July 3, 2015

Filed under: Asset Protection — Neel Shah @ 9:15 am

If you were party to an alimony arrangement where the other spouse has received benefits, it’s not uncommon for circumstances to change over time. Alimony recognizes that one party should be receiving support and that another party is responsible for providing it, usually for a set period of years or until certain conditions are met.shutterstock_263038649

Post-divorce, however, your former spouse might move on to another relationship. If he or she is now cohabitating with that other person, your alimony could be dropped. It can be challenging to demonstrate these issues in court, but it is possible. Many courts lack a standard definition about this, but evidence could include social media disclosures, shopping patterns, property maintenance records, cell tower records. These could be used to demonstrate that your spouse is living with someone else.

Modifying an alimony award could significantly impact your financial circumstances and asset protection. It may be in your best interests to discuss your situation with a family law attorney if you believe that your alimony award should end; for more complicated asset protection strategies for those funds once you are no longer responsible for making alimony payments, you should consult with your estate planning and asset protection professional. Get our help at

Business Succession Advice: What to Know About the Unsolicited Offer

July 2, 2015

Filed under: Business Planning,Business Succession Planning — Neel Shah @ 9:15 am

If someone comes to you seemingly out of the blue to make an offer on your business, tread carefully. Although this can seem exciting, you need to carefully vet this individual and determine whether it’s the right fit for your business.shutterstock_253802632

One of the biggest problems with the unsolicited offer is that it pulls attention away from running a company into selling one, because the offer of stepping away from routine and receiving a large sum of money can be very tempting. Large industry firms that make these offers could contact dozens of firms with the aim of never providing a price and instead stringing out the process long enough so as to receive a discount.

If you’re considering this unsolicited offer, be proactive. Request a confidentiality agreement and a clear letter of intent from the buyer. This is simply due diligence on your party. If the buyer balks at your requests, you can point this person to discuss future offers with your firm’s specialist on mergers and acquisitions. The remove yourself from the game without any further losses of time, energy, or personal information about your business. Contact us for more advice at

Estate Planning: Wills for Heroes

July 1, 2015

Filed under: Estate Planning — Neel Shah @ 9:15 am

Putting together wills and powers of attorney are cornerstones of estate planning. In the aftermath of 9/11, an attorney in South Carolina approached first responders and firefighters only to learn that as many as 80 percent were without these critical documents. shutterstock_255529753

While we often suggest on this blog that everyone have a will, it’s especially important for individuals in these special situations to plan ahead. While it’s hoped that your loved ones don’t have to worry about what should happen if you were to pass away, planning can help to limit the trauma and grief faced by your family members in an already difficult time.

If you have never put together a will or amended it recently, consider the challenges your loved ones might face if something happened to you. The last known location of your will could be unknown or other family members could argue that it’s not valid. Lack of clarity could mean that some of your beneficiaries don’t know what they are entitled to. All of these issues can be avoided with a little bit of planning.

It’s never easy to plan for these worst case scenarios, but doing so can give you great peace of mind and help your own family in the event that something ever does happen to you. We’re proud to help those who put their lives on the line discuss these critical details and make plans that reflect your needs and wishes. Contact us today to learn more about the value of estate planning.

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