Jay and Mark performed a full review of the Owners' current plan as well as both their short and long term goals. They modified the plan to save on potentially significant tax bite (#1) and properly fund appropriate Life Insurance Coverage (#2).
#1 Stock Redemption buy/sell was converted to a Cross Purchase agreement, thereby creating potential to avoid significant capital gains tax in case of death and subsequent sale by the survivor.
#2 An Insurance Audit determined:
a. A lack of disability income coverage in place for the Buy/Sell, which was subsequently corrected.
b. Insufficient and inefficient Life Insurance, which was replaced by a new permanent policy with the 20% annual premiums savings redirected to their retirement plans.
Jay Thompson is a corporate, mergers and acquisitions attorney and partner with Freeman, Freeman & Smiley. JTT@FFSlaw.com.
Mark Kandarian is a Life, Disability & Long-Term Care insurance and financial consultant and the Executive Director of Succession-Retirement Strategies & Solutions. (949)296-8356x83. |
