It has been a tough year for small businesses. Across the country, millions of small businesses have temporarily closed their doors due to the COVID-19 pandemic. Even now, as the pandemic eases and operations begin to pick back up, many small businesses report that they are struggling to fill open positions.
But business owners are resilient and creative. Despite the difficulties of the past year, most businesses expect to survive the pandemic, and interest in starting a new business remains high. Many aspiring business owners are interested in becoming franchise owners. In this uncertain economic climate, starting a franchise offers several benefits over other paths to business ownership. Starting a new nonfranchised business is riskier than franchising, can require more upfront capital, and does not provide the network of training and support often available to franchisees.
Franchising, like any business, requires planning, preparation, and paperwork...
Where do you find a good plumber? Who can recommend a good Italian restaurant? Who is the best divorce attorney in town? Sometimes these answers are found by asking family, friends, and neighbors, but many people find answers to these questions on social media and review sites such as Google, Yelp, Amazon, Facebook, and TripAdvisor. Customer reviews and testimonials are excellent marketing tools for a business because they build trust and goodwill and showcase your brand’s history. However, before you use them to promote your business, you need to be aware of what you can and cannot do.
The Federal Trade Commission (FTC) is...
Confused about the differences between a will and a trust? If so, you are not alone. While it is always wise to contact experts like us, it is also important to understand the basics. Here is a quick and simple reference guide:
What a Revocable Living Trust Can Do – That a Will Cannot
What a Will Can Do – That a Revocable Living Trust Cannot
Unaware executors may be exposed to potential personal liability.
The Internal Revenue Service has issued proposed regulations establishing a $67 fee for the issuance of an estate tax closing letter (also known as an IRS Letter 627).
These letters provide an executor of an estate with evidence that the IRS has accepted a filed Form 706, “United States Estate (and Generation-Skipping Transfer) Tax Return,” and that the agency has closed its examination of the return...
The year 2020 was a continuous lesson in the need to prepare for the unpredictable. From the pandemic to natural disasters, businesses have faced numerous challenges that could force them to close. The most common emergencies that businesses typically face fall into three categories:
The Small Business Administration estimates that 25 percent of businesses fail to reopen after an emergency or disaster. In light of this uncertain period, it is essential to take proactive steps to prepare your business for an emergency. Here are the six main things you should keep in mind as you develop your business’s emergency plan...
Succession planning has always been an integral part of estate and retirement planning. For many business owners, especially those in closely held businesses, preparation for succession or the sale of their business is crucial for the owners’ financial future. In light of the global pandemic, we have a situation that’s changing the face of “normal” succession planning. This is also quite relevant to estate planning. If an individual is contemplating a near-term liquidation of a business interest, that may impact the type of estate planning that may be warranted. If an individual lives in a high tax state, consideration of transferring interests to a non-grantor trust in a no-tax state may also be warranted.
This Time Is Different
Although many business owners have weathered difficult times in the past, and perhaps rebuilt their businesses through several recessions, the current situation feels different. Some business owners experienced very bleak times following 9/11 and were able to recover. They survived the financial meltdown in 2008–2009. Now COVID-19. Business owners face a larger dilemma, which has many contemplating whether it is time to do something different.
For individuals who own real estate, it is important to consider the best way to structure your ownership. When you are just starting out as an investor in real estate, you may hold title to the real estate personally, but that may not be the most advantageous method of ownership. Another option is to create a limited liability company (LLC) for your real estate ventures. An LLC is a type of legal business structure organized under your state’s law.
There are many important considerations to keep in mind as you decide whether to form an LLC to hold your real estate. Here are a few things to think about to help you make the best decision for your unique circumstances...
Following the first surge of COVID-19 cases in the United States, many businesses financially impacted by the pandemic have applied for federal funds through the federal government's Paycheck Protection Program (PPP). One key element of the PPP is loan forgiveness, but business owners who received PPP funds must apply for loan forgiveness. If you received funds and are in the process of requesting loan forgiveness, the Small Business Administration and the Treasury Department have introduced new guidance and changes to assist both lenders and PPP borrowers of $50,000 or less with the forgiveness process. The changes include
With a push by the Democratic party to return federal estate taxes to their historic norms, taxpayers need to act now before Congress passes legislation that could adversely impact their estates. Currently, the federal estate and gift tax exemption is set at $11.58 million per taxpayer. Assets included in a decedent’s estate that exceed the decedent’s remaining exemption available at death are taxed at a federal rate of 40 percent (with some states adding an additional state estate tax). However, each asset included in the decedent’s estate receives an income tax basis adjustment so that the asset’s basis equals its fair market value on the date of the decedent's death. Thus, beneficiaries realize capital gain upon the subsequent sale of an asset only to the extent of the asset’s appreciation since the decedent’s death.
If the election results in a political party change, it could mean not only lower estate and gift tax exemption amounts, but also the end of the longtime taxpayer benefit of stepped-up basis at death. To avoid the negative impact of these potential changes, there are a few wealth transfer strategies it would be prudent to consider before the year-end.
Intrafamily Notes and Sales