Facebook and Estate Planning

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Facebook and Estate Planning

By James F. McDonough, Jr. on May 18th, 2012

Facebook has grabbed the headlines, but behind the scenes key personnel have undertaken critical estate planning, proving that they are more than just technically savvy. Here’s how it worked.

The Wall Street Journal just reported that six of the insiders in Facebook established Grantor Retained Annuity Trusts (GRATs) last year. These trusts were established at a time when the estimated fair market value of the Initial Public Offering (IPO) was expected to be about $29 to $30 a share. Given that there are now reports that the IPO price may be significantly higher, this strategy would appear to be yielding an immediate benefit.

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

© James McDonough, Scarinci Hollenbeck | Attorney Advertising

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