LAND OF THE SKY ESTATE PLANNING COUNCIL

Zac and Tate will discuss the Connelly decision.

Connelly v. United States brings unwanted attention to closely held businesses with entity purchase (stock redemption), buy-sell arrangements funded with life insurance. Specifically, the Connelly decision resulted in an additional $900,000 of estate tax due at the death of the majority shareholder and brother of the surviving business partner. In this session, we discuss why back-of-the-napkin math, lack of an independent valuation, and an outdated agreement contributed to the IRS’ ruling, and why all closely held business owners, especially those with entity purchase agreements, should dust off their agreements.