News & Analysis as of

Closely Held Businesses

Rivkin Radler LLP

Not Aware of Your Business Partner’s Tax Situation? Maybe You Should Be

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If you’ve worked with the owners of closely held businesses for even just a few years, you have realized they are only half joking when they complain about having the government as a partner. Consider how much federal, state,...more

Foodman CPAs & Advisors

Charitable LLCs Warning from IRS

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On 11/4/24, the Internal Revenue Service issued a warning to taxpayers regarding the dangers of engaging with promoters of fraudulent tax schemes that involve donating ownership interests in closely held businesses, often...more

Baker Donelson

Key Approaches for Maximizing Post-Judgment Enforcement Outcomes

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As we noted in our Fraud and Commercial Loan Transactions: Post-Judgment Legal Strategies Webinar, fraud in commercial loan transactions presents significant challenges for creditors seeking to recover funds. Once a judgment...more

Farrell Fritz, P.C.

Fact Issues and Credibility Determinations on Injunction Motions

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Almost exactly one year ago, we wrote about the go-to line of New York case law for business divorce litigants hoping to secure injunctions: a substantial and ever growing body of authority holding that involuntary loss or...more

Robson & Robson, P.C.

The use of a commercial lease to rip off minority owners in a closely held business

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Today we’re going to talk about one of the more common ways that a majority owner can rip off minority owners in a closely held business. And that is by causing the company to enter into a lease with an affiliate of the...more

Cole Schotz

Death, Taxes and Shareholder Agreements: Lessons from the Connelly Case

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Recently, the U.S. Supreme Court ruled unanimously in Connelly v. United States, that the valuation of a decedent’s shares in a closely held corporation for federal estate tax purposes must include insurance proceeds received...more

Rivkin Radler LLP

Choice of Entity for a U.S. Business- Passthrough Status Matters Beyond the U.S. Border

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Decisions, Decisions - The owners of a closely held U.S. business will have to make many difficult decisions during the life of the business. Among the earliest of these is the so-called choice of business entity, the...more

DarrowEverett LLP

How Will New Congress Impact Tax and Estate Planning Strategies?

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With the looming elections, tax planners have taken time to consider what the future of Estate and Gift Tax planning might be under the new Congress. Every new Congress considers changes to the Internal Revenue Code of 1986,...more

Partridge Snow & Hahn LLP

Recent Supreme Court Decision Upends Business Succession Planning Strategies

In Connelly vs. United States (602 U.S. 257, June 6, 2024), the Supreme Court unanimously ruled that in a redemption of a deceased shareholder’s shares of stock, the corporation’s fair market value should include the proceeds...more

Bradley Arant Boult Cummings LLP

Keeping the Family Harmony Playing Sweetly: Risk Avoidance for Owners of Family-Owned Companies

Business divorces take place in all types of private companies, including those owned and operated by family members. But families that are willing to engage in thoughtful planning can head off some of the internal conflicts...more

Procopio, Cory, Hargreaves & Savitch LLP

Considerations for Taxable Estate Owners with a Beneficial Tax Provision Possibly Expiring

A key benefit to families with taxable estates may be about to go away. The Tax Reform Act of 2017 incorporated numerous tax reductions into U.S. law, with one significantly increasing the ability of taxable estate owners to...more

Bowditch & Dewey

Is Your Close Corporation’s Real Estate Safe from Shareholder Claims of Ownership by Adverse Possession?

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In a case of first impression, the Land Court decided that shareholders of Massachusetts close corporations may acquire corporate real estate by adverse possession. In Szawlowski v. Szawlowski Realty, Inc., the Court...more

Farrell Fritz, P.C.

Conditional Grants of Membership Interests Are a Roadway to Courtroom Conflict

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In the world of business divorce litigation, this summer saw everything but a slowdown.  We witnessed (and blogged about) Justice Crane cap a long-running fair value proceeding with helpful guidance on appraisals and...more

Rivkin Radler LLP

Owners of Closely Held Businesses: Time to check your buy-sell agreement

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Most closely held businesses, whether organized as a C or S corporation, LLC or partnership, have (or should have) a buy-sell agreement. A buy-sell agreement addresses what happens to an owner’s interest in the business when...more

Blank Rome LLP

Supreme Court Issues Ruling Affecting Valuation of Closely Held Corporations Employing Life-Insurance-Funded Redemption-Type...

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Improperly structured buy-sell agreements for closely held businesses will lead to an unexpected increase in the estate tax imposed on the estate of the deceased owner. The Supreme Court decision emphasizes the need for a...more

Kilpatrick

Estate Planning Considerations Post Connelly v. United States

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On June 6, 2024, the Supreme Court of the United States issued a unanimous decision in Connelly v. United States and found that life-insurance proceeds payable to a closely held business for the purpose of funding a share...more

Gerald Nowotny - Law Office of Gerald R....

Elena Ruiz and the Cuban Sandwich - The Double Irish with Dutch Sandwich Version for Closely Held Business Owners - Using...

I have been a major fan of Afro-Cuban (Salsa) and Brazilian Bossa Nova music since high school. Most of you know by now that I grew up in the Panama Canal Zone. By the time I got to West Point in the summer of 1978, it was...more

Husch Blackwell LLP

Unanimous Supreme Court Determines Company-Owned Life Insurance Increases Fair Market Value

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On June 6, 2024, the Supreme Court held 9-to-0 in Connelly v. United States that company-owned life insurance increases the company’s fair market value for estate tax purposes, and the company’s obligation to redeem a...more

UB Greensfelder LLP

The U.S. Supreme Court’s Decision in Connelly Impacts Estate Tax Valuations of Closely Held Businesses

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The Supreme Court’s recent decision in Thomas A. Connelly et al. v. United States has significant implications for certain closely held business owners. The decision is important especially for those with, or planning to buy,...more

Levenfeld Pearlstein, LLC

Redemption Agreements and Life Insurance Proceeds: What the SCOTUS Decision in Connelly Means for Closely Held Businesses

Many closely held businesses have shareholder buy/sell redemption agreements. These agreements are critical to maintaining business continuity when a key shareholder exits the company. When the redemption agreement is...more

Venable LLP

Whose Value Is It, Anyway?

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On June 6, 2024, the U.S. Supreme Court issued a unanimous decision in Connelly v. United States affecting the valuation of closely held businesses for estate tax purposes. The Court explained that, for purposes of federal...more

Lathrop GPM

Is AI Putting Your Closely Held Business at Risk?

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Business leaders are considering new AI tools that grow more sophisticated each day. For closely held businesses on the lookout for innovative and tech-enabled cost savings, AI can offer a competitive edge by taking on...more

Allen Barron, Inc.

Connelly v Internal Revenue Service

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Connelly v. Internal Revenue Service is a landmark SCOTUS decision that will impact business owners, partners, shareholders, members, and professional practitioners from a business perspective, succession planning, as well as...more

Tannenbaum Helpern Syracuse & Hirschtritt LLP

Supreme Court's Connelly Decision Significantly Impacts Business Succession Planning

On June 6, 2024, the U.S. Supreme Court issued a pivotal decision in Connelly v. United States, affecting how life insurance proceeds are treated in buy-sell agreements for closely held corporations. The ruling states that...more

Hinckley Allen

Supreme Court Decision Yields Significant Impacts for Closely Held Businesses

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On June 6, 2024 the Supreme Court unanimously ruled that life insurance proceeds should be included in the fair market valuation of a corporation for federal estate tax purposes. In Connelly v. United States, the Supreme...more

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