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S-Corp Opposes Grantor Trust Changes

The proposed changes to grantor trusts included in the Build Back Better Act (H.R. 5376) are a serious threat to Main Street employers nationwide. The authors claim these changes would ensure billionaires “pay their fair share,” but in reality they would fall most heavily on family-owned businesses, making it all but impossible for some of them to survive from one generation to the next.

To highlight this threat, S-Corp sent a letter today to the House’s top tax writers detailing the history of grantor trusts, the flaws in the proposals in H.R. 5376, and the harm they would inflict on

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2021-10-21T22:00:48+00:00October 21, 2021|

Estate Tax Hike Threat to Family Businesses

With the Senate Majority Leader committed to a “dual-track” legislative strategy that includes a partisan budget resolution, Congress will soon be tasked with deciding which revenue raisers to include in a multi-trillion-dollar reconciliation package. A key area of concern for private companies is the estate tax and related provisions.

Some proposals under consideration, like applying capital gains taxes at death, literally threaten the ability of family businesses to survive from one generation to the next, and the family business community is understandably alarmed about their prospects.  As such, we wanted to provide an update on the latest developments in this space,

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2021-08-09T22:22:42+00:00August 6, 2021|

Wealth Taxes Pose Existential Threat to Private Businesses

The Peterson Institute held a “Combating Inequality” event last week that included a vigorous debate over wealth taxes.  The heavyweight match between Emmanuel Saez – the leading advocate for wealth taxes these days – and Larry Summers in particular is worth watching.

One aspect missing from the debate, however, was how wealth taxes would handcuff successful private businesses.  Summer briefly touches on the challenge his family’s hardware store would have paying the tax, but there is so much more to it.  Wealth taxes:

  • Are far larger than their headline numbers suggest;
  • Paid on top of all existing taxes;
  • Hit hardest

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2019-10-22T14:03:18+00:00October 22, 2019|

Treasury Hits Family Businesses!

The verdict is in, and Treasury’s proposed rules on estate tax valuations of family-owned businesses are broad – very broad indeed. They are, simply put, a direct assault on America’s family-owned businesses.

Here’s the take of WealthManagement.Com:

Although the details are significant, the bottom line is that the proposed regulations would appear to eliminate almost all minority (lack of control) discounts for closely held entity interests, including active businesses owned by a family. To accomplish that, restrictions under the governing documents and even those under state law would be disregarded for valuation purposes.

And Steve Leimberg’s Estate Planning Email Newsletter:

In short,

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2019-02-01T19:56:24+00:00August 9, 2016|

Tax Policy on the Table for September

Members of Congress are back home and set to return mid-September for a final three week session before the November elections. Add in two or three weeks of possible “lame duck” session, and that’s the extent of time available to tax writers to address the numerous items on their honey-do list:

  • Preventing the 2011 tax hikes (including AMT);
  • Adopting the small business tax bill;
  • Extending the extenders that expired last year;
  • Extending the extenders that will expire this year; and
  • Something on the estate tax.

Given that these issues have been before Congress the entire year, it’s difficult to conceive how Congress would suddenly jump into

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2019-02-04T15:47:04+00:00August 19, 2010|