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Estate Planning for Owners of Closely-Held Businesses

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Estate Planning for Owners of Closely-Held Businesses

  1. 1. ESTATE PLANNING Business Owner Strategies
  2. 2. Estate Planning for Owners of Closely-Held Businesses The Importance of Estate Planning If you’re like most business owners, your business is your largest and most important asset. This means that when you die it’s likely to be included in your estate at its full market value, resulting in a sizeable federal estate tax obligation. Without proper planning, the cash to resolve that tax liability may not be easily obtainable from the business. What you can do to resolve estate tax liability If the business represents a significant portion of your estate, one option would be to pay the estate tax, plus interest, over a number of years, essentially borrowing from the IRS. This can be a costly way for your estate to meet the obligation, potentially draining much needed assets from the business you’ve passed on to your heirs. We can introduce you to another option, one that would fund the estate tax obligation for your heirs and make sure your business isn’t compromised in the process. After decades of working with business owners to help them find estate planning solutions, we’ve got the experience and expertise to help you find the right strategy for your closely-held business. Key Estate Planning Issues We can supplement and enhance the assistance of other planning advisors. • The Phoenix Business Valuation Service can help you determine the value of your business for estate and gift tax purposes. It’s informal, informative and free. • Our experts can help you estimate your final estate tax obligations and devise strategies to provide sufficient liquidity to address them, without severely eroding the net estate passed on to your heirs. The insurance and investment products are: – Not insured by FDIC, NCUSIF, or any other state or federal agency that insures deposits; – Not a deposit or obligation of, underwritten or guaranteed by, the depository institution or any affiliate; – Subject to investment risk, including possible loss of principal invested. IRS Circular 230 Disclosure: Any information contained in this communication (including any attachments) is not intended to be used, and cannot be used, to avoid penalties imposed under the U. S. Internal Revenue Code. This communication was written to support the promotion or marketing of the transactions or matters addressed here. Individuals should seek independent tax advice based on their own circumstances.
  3. 3. • We can show how life insurance solutions such as single life and second-to-die life products are cost effective ways to make sure there is sufficient liquidity to meet any estate tax liability on your estate. • We can help you decide if a buy-sell agreement among the business owners — or, if in a family business, among parents and children currently active in the business — is a good way for you to obtain necessary liquidity. • Finally, we can help you assess your wills and other estate planning documents to see if they take full advantage of opportunities to minimize estate taxes — through the use of bypass trusts, leveraged lifetime gifts, valuation discounts and other planning techniques. How to Get Started Phoenix has a team of professionals who can work with your advisors to create an estate plan tailored to your specific circumstances. Understanding all aspects of your business needs and challenges is critically important — and your financial representative has the experience to do just that. • We’ll meet with you and your trusted advisors to: – learn about your needs and what you want for your business, – devise strategies to meet your goals, and – develop recommendations based on those strategies. • In appropriate cases, we’ll prepare detailed life insurance proposals that will help you evaluate the costs and benefits of using life insurance to meet your planning needs. Contact your financial representative today to discuss Business Owner Strategies. Phoenix does not offer tax or legal advice.
  4. 4. With roots dating to 1851, The Phoenix Companies, Inc. helps individuals solve diverse and often highly complex financial and business planning needs with an array of life insurance and annuity products and services reflecting the company’s deep insights into the changing wants and needs of the marketplace. Insurance issued by PHL Variable Insurance Company (PHLVIC) (Hartford, CT). PHLVIC is not authorized to conduct business in Maine and New York. In Maine and New York, insurance is issued by Phoenix Life Insurance Company (PLIC) (East Greenbush, NY). The issuers referenced above are separate entities, and each is responsible only for its own financial condition and contractual obligations. Members of The Phoenix Companies, Inc. phoenixwm.com L5000B ©2008 The Phoenix Companies, Inc. 12-08 BPD36185

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