Families with complex business assets may require advanced estate planning vehicles, including Family Limited Partnerships and Family Limited Liability Companies. What are these estate planning vehicles, though? What benefits do they offer? And how can they be applied? Gain insight from Max Alavi APC, OC Trusts Lawyer.
What are Family Limited Partnerships and LLCs?
Families that have complex business assets may require advanced estate planning vehicles. Family Business Entities can be invaluable in accomplishing the family’s long-term business, estate, and financial planning objectives. Consider some benefits of using Family Limited Partnerships or Family Limited Liability Companies.
What’s the Purpose of Family Limited Partnerships and Family Limited Liability Companies?
There are several reasons to consider these Family Business Entities, including:
- They provide asset protection.
- They provide income, gift, and estate tax savings through valuation discounts.
- They allow for the centralized management of family assets.
- They facilitate business succession planning.
- They help train younger generations in effective asset management.
What are the Types of Family Business Entities?
Generally speaking, Limited Partnerships (also known as LLCs) are used as estate planning vehicles to achieve valuation discounts for estate and gift tax purposes and limited liability for most or all owners.
LLCs offer many advantages, including flow-through income for tax purposes. They also yield more management flexibility when compared with other vehicles.
It’s crucial to note that the terms “Family Limited Partnerships” and “Family Limited Liability Companies” bear no legal significance. These titles denote the secondary advantages of these vehicles.
Using Family Business Entities for Asset Protection
These vehicles are usually employed when there are assets of significant worth, typically exceeding $10 million. Family Limited Partnerships and Family Limited Liability Companies provide options to give away or distribute assets while offering substantial tax discounts, thus preserving the estate’s overall value.
To implement one of these estate planning tools, it’s critical to consult with a skilled attorney. To find out more, connect with Max Alavi APC, OC Trusts Lawyer, who boasts a sterling reputation and a proven track record helping clients manage sophisticated estate planning solutions. Schedule a consultation with Max Alavi APC, OC Trusts Lawyer, today.