As a firm that often works closely with entrepreneurs in the transition of their business, be it through a long range exit planning exercise or within the context of a sell-side M&A transaction, we are acutely aware of how complex and nuanced the sale process has become. Owner-operators, management teams, Boards, and more generally, the principal stakeholders need to wrestle with a host of issues. The laundry list includes establishing valuation expectations, defining strategic and cultural fit, securing livelihoods for their valued employees, determining what kind of process they want (auction or otherwise), formulating a buyer universe, pre-transaction due diligence, post LOI due diligence, reps and warranties within the P&S, and so on and so forth.
Your grandparents may have purchased a permanent life policy, put it in a drawer and forgotten about it—and that might have been okay—but today’s life insurance policies are complex financial instruments and need to be monitored like any other asset in your portfolio. A permanent life insurance policy can be one of your most important financial assets and you want it to be there for your beneficiaries when it’s needed the most, or perhaps for your own retirement, if you purchased a cash accumulation contract. The best surprise is no surprise and a life insurance policy surprise is almost never good. A policy audit can tell you if your policy is in trouble or headed for it, and what corrective action may be possible.
I will freely admit writing a light, easy read on potential changes to Treasury Regulations as it pertains to valuing ownership interests in family-owned businesses may not really be a thing, but, in our minds, it is front and center. If you are not in the field of financial and estate planning, this issue may not be on your radar, but for folks out there who own or are actively involved in a family enterprise, it should be.
We thought we’d have some fun with our Blog this month, so gather ‘round the campfire friends for a Tax Tale that may become the stuff of legend to be repeated around campfires for years to come. (Okay, maybe not.) Your narrator is Chuck Baldwin. “This is a true story of tax savings thanks to creative planning with some little known techniques. Some of names have been changed for all the usual reasons. So break out the marshmallows and lend an ear.“There once was a business owner who was very happy because his business was making lots of money. Let’s call him Max Tax.
Wealth Management Services (“Investment Advisory”, “Financial Planning”, “Retirement Planning”, “Estate & Wealth Transfer Planning”, “Exit Planning”, “401(k) & 403(b) Advisory & Management”, “Qualified Plan Design & Consulting”) are offered through Baldwin & Clarke Advisory Services, LLC (BCAS). BCAS is a Registered Investment Adviser with the United States Securities and Exchange Commission (SEC). BCAS’ Form CRS and other disclosure documents can be found here. The information in this website has not been approved or verified by the SEC, or by any state securities authority. Additional information about BCAS is available on the SEC’s website at: www.adviserinfo.sec.gov, using CRD#105666. Registration does not imply a certain level of skill or training.
Investment Banking Services (“Pre-Transaction Planning”, “Business Valuations”, “Buy-Side & Sell-Side M&A Advisory”, “Debt & Equity Capital Advisory”) are offered through Baldwin & Clarke Corporate Finance, LLC.
Insurance Planning Services (“Life Insurance Planning”, “Disability Insurance Planning”, “Long-Term Care Insurance Planning”, “Shareholder Life Insurance Planning”, “Executive Benefit Planning”, “Key Person Insurance Planning”) are offered through Baldwin & Clarke, LLP.