Spreading The Wealth
Transferring part of your business to your children now could lower their taxes later.
You've worked hard building your business, but like many busy entrepreneurs, you probably haven't spent much time planning for what will happen to the company when you're no longer around. Enter the family limited partnership, a popular estate-planning device that may be just what you need to keep your company in the family and avoid painful tax consequences.
Planning for a business transfer is never a cake walk, but to ease the burden on your family, it's necessary--and the sooner you do it, the better. This is especially important if you operate a family business and want the company to stay in the family when you decide to step down or if some unexpected event transpires. Estate taxes can hit family businesses hard because the full value of a parent's business can be included in the parent's estate when he or she dies.
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