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Legal Forum Column: Steven R. Wilson
Posted in Estate Planning

In the new Legal Forum Column, Steven R. Wilson discussed new proposed IRS regulations. Read his advice below and don’t miss our monthly Legal Forum Column in Louisville Business First.

Question
How will the new proposed IRS regulations related to valuation discounts impact my business planning?

Answer
For decades, small business owners have utilized valuation discounts to minimize estate and gift taxes while simultaneously providing an orderly transition to the next generation. The business was placed into a family limited partnership or recapitalized with controlling and non-controlling interests. The owner then gifted limited partnership or non-voting interests to the younger generation over multiple years, taking advantage of the annual gift exclusion and lowering the taxable estate of the older generation.

The IRS recently issued proposed regulations (Reg-163113-02) that would effectively close this planning tool and make it nearly impossible to use this type of discount planning. The new regulations will disregard transfers between family members when determining control, effectively limiting valuation discounts. Fortunately, there is still time to take advantage of this planning before the regulations are finalized. If you own a business and have an estate that may be taxable, consult with a planner now to utilize this planning device before the IRS takes it away!


To learn more about Steven R. Wilson and his practice, please visit his profile.

To view the latest Legal Forum column, please click here.

  • Partner

    Steve concentrates his practice in the area of trusts and estates, including planning, administration and dispute resolution.  He also has experience in business succession planning, commercial real estate transactions and ...

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