Estate and Succession Planning for a Business Owner


A married 72 year-old with two children had a real estate company valued at $75 million and was concerned about what would happen to the company at his death. He had recently learned that the estate tax would be $30 million and that the proceeds from his $10 million life insurance contract would be subject to an additional $4 million of taxes. Furthermore, the real estate market was booming and conservative growth models showed that the business could be worth in excess of $100 million in 10 years, creating another $10 million of estate taxes.

Client’s Objectives

  1. Leave the business to his children at his death.
  2. Minimize estate taxes at his and his wife’s death and the death of future generations.
  3. Protect all assets left to his children and grand-children from creditors and a potential divorce.


  1. Establish estate documents that will allow both him and his wife to take advantage of the estate tax exemptions available.
  2. Create a trust (or trusts) for their children and grandchildren that could be outside their taxable estates and protected from creditors and divorcing spouses.
  3. Gift and sell non-controlling interests in the company to the legacy trust(s).
  4. Restructure the life insurance so it will not be subject to income or estate taxes.
  5. Work closely with their attorney and accountant to ensure everything is properly coordinated.