Hardwood Floors June/July 2019

BUSINESS BEST PRACTICES FINANCE

Transferring Business Ownership to Children

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After building a successful business, many business owners decide they want to transfer ownership to their children. This desire to share success with the next generation is no different from non-business-owning parents. However, the tools they can use to transfer wealth vary. Whether you own a business or not, the fundamental questions are the same:

1 . How much wealth

2. How much wealth do you want the children to have? How much is too much?

3. What tools can you use to minimize the Estate and Gift Tax consequences of transferring wealth?

do you want to keep for yourself?

Business owners have to put those questions in the context of their exit objective. Once owners establish their financial exit objective, they can answer the universal questions above and design a transfer mechanism that will pass the wealth to the children with minimal tax impact.

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