Transition and Estate Equalization

Both business owners and non-businessowning parents want to transfer a monetary legacy to their children, if possible. However, business owners are different in the tools they can use to transfer wealth. Whether you own a business or not, the fundamental questions are the same:

1. How much wealth do you want to keep?

2. How much wealth do you want the kids to have, and how much is too much?

3. Which tools minimize the estate- and gifttax consequences of transferring wealth?


Business owners have to put those questions in the context of their Exit Objective: "How much money do I wish to have after I exit my business?" Once owners establish their financial Exit Objective, they can answer the universal questions above and design a transfer mechanism that will pass their wealth to their children with minimal tax impact.

Most find succession planning more difficult than other critical business decisions. It is important to know although they are in the same category, estate and succession planning are not the same.

Succession planning directly relates to the actual business itself. It is the strategy that will enable it to continue to operate smoothly and effectively as it is passed onto future generations, partners, or successor owners. 

Estate planning relates to all the assets in an individual’s estate including any ownership interests in closely held businesses.