At what point should you feel comfortable that you have done enough estate planning? When you have a will? When you buy some insurance? When you have done an estate freeze? In many ways it depends on your objective. Here are five to consider:
• Provide enough income and capital for your family to live comfortably
• Make sure your business survives and prospers when you are gone
• Make sure someone is ready to take over the business
• Make sure the surviving family members do not fight over the estate
• Minimize tax
At different stages of your life some of these objectives will be more important than others. If minimizing tax is most important to you now, then you will likely use a different set of tools to accomplish this goal than if you want to make sure your business survives and prospers after you are gone
Minimizing tax on the estate and the beneficiaries is often referred to as post-mortem planning. Tools such as “roll and redeem”, the “loss carry back”, the “pipeline” and the “bump” can be very effective to minimize the tax on all parties. But don’t be fooled. The phrase “post-mortem planning” is a misnomer. Planning is needed while still alive in order to maximize the flexibility to the estate and beneficiaries and to avoid the many pitfalls that may prevent the tax minimization objective from being accomplished.
Make sure your tax plan doesn’t stop with you. Tax minimization can also be accomplished for your estate and your children.
Mar 07, 2014
Collins Barrow Chartered Accountants, 0342 Gerrie Rd, Elora, 519-846-5315
Collins Barrow Chartered Accountants. With 35 years of experience, they are ready to help you with your succession planning needs. To discuss your options, contact them at (519) 846-5315 or by email at info@collinsbarrow.com.