The Original Situation
- Couple in their early 50’s and had 4 sons.
- His father started a family business and ownership was passed to the client, his brother, two sisters, their spouses, and 7 members of the third generation. Including the father there were 16 owners
- The client and his brother were leading and operating the company, but they were grossly under compensated..
- None of the client’s nieces or nephews were interested in running the family business and his sons were interested but still in college or high school.
- company was filing as an S-Corp and had substantial income being reinvested.
- We had the client and his brother distribute excess retained earnings and convert to a C-Corp.
- The company bought back the stock from all family members except the client, his brother, and their wives.
- The company increased the client and his brother’s wages to a competitive level.
- We developed a plan to bring the client’s sons into the business after spending time working in other industries and determined they wanted to work in the family business.
- We utilized a self-funded buyout with a gift of stock to their sons and a Charitable Remainder Trust with the company purchasing and retiring the stock.
- We utilized life insurance to equalize their sons’ inheritances if any decided not to be involved in the family business.
Maximizing Family Value
Lifetime Income: Increased 42%
Lifetime Inheritance: Increased 640%
Post-Death Inheritance: Increased 52%
Income Taxes: Decreased 51%
Capital Gains Taxes: Decreased 68%
Inheritance Taxes: Completely Eliminated
Lifetime Giving: Increased 527%
Total Giving: Increased 1000+%
Case studies are for informational and illustrative purposes only and not to be considered a guarantee of results.
Actual results will vary with each situation.