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Estate Of Affairs

They say only two things are certain: death and taxes. In the event of the first, here's how to keep Uncle Sam from taking more than his fair share.

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This story appears in the May 1998 issue of Entrepreneur. Subscribe »

If you've already done long-range for your company,you've probably established a way to transfer whenyou pass on. But do you know what the tax consequences of such atransfer will be? Are you clear about what taxes your heirs or theother owners in your will have to pay and how they'llpay them? According to tax experts, trouble may lie ahead forsmall-business owners who don't know the answers to thesequestions.

Before examining the tax consequences, however, a word aboutplanning. Properly planning for business ownership transfer is asimportant as writing a will, experts say. The planning processforces you to iron out how ownership will change hands and how topay for the transfer in the event of death. Putting thisinformation on paper gives you the confidence of knowing youwon't be leaving your business partners or family in a bindwhen you die.

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