The IRS has issued new proposed Section 2704 regulations relating to transfers of business interests to family limited partnerships (FLPs), and they are not taxpayer-friendly.
Strategy: Run—don’t walk—to your tax pro’s office if you are interested in setting up an FLP to minimize federal estate and gift taxes. The changes, which are primarily designed to close tax loopholes in valuations of FLPs under Section 2704, could have major estate and gift planning implications for many business owners.
The new anti-taxpayer regulations won’t take effect until they’re finalized, probably sometime next year. Still, you should figure out now how the chips will likely fall and plan accordingly.
Here’s the whole story: With an FLP, or a family limited liability company (FLLC) set up for this purpose, you transfer business ownership interests to the entity. While you become the general partner of the FLP (or managing member of the FLLC), ...(register to read more)
- Small Business Tax Deduction Strategies No matches