Taxation & Estate Planning

Study Reveals Ultra-High-Net-Worth Family Businesses Are Not Implementing Succession Plans and Asset Protection Strategies

By Juan C. Antúnez

File this under business development for all you trusts-and-estates planners out there.  A new study sponsored by U.S. Trust, Bank of America Private Wealth Management finds that the majority of owners of ultra-high-net-worth family businesses are leaving their professional and personal interests vulnerable through inadequate business succession, asset protection and estate planning. Click here for a link to the full press release. 

Although the full study is not available on line (you have to buy it), the following bullet points caught my attention (again, think business development):

Succession Plans Collecting Dust

• While over three quarters (76%) of owners have succession plans, only 38 percent implement them, inadequately addressing issues of succession
• Most individuals with succession plans in place are not focusing on tax-mitigation issues (73%), even though nearly all participants (93%) report a desire to lower the tax burden associated with transferring the business

 Asset Protection Strategies Missing

• Almost nine out of 10 (89%) business owners were "very" or "extremely concerned" about protecting the family's wealth
• However, nearly three quarters (73%) of them do not have asset protection plans in place

Estate Plans Outdated

• Over three quarters (78%) of owners have personal estate plans; however, 89 percent have not updated them after a life-changing event such as marriage, birth or death rendering the plan obsolete
• More than half (54%) of participants lacking estate plans reported difficulty dealing with their own mortality, and one quarter (25%) cited a lack of time as reasons for not creating a plan

Blogging credit:

Credit goes to the WSJ Wealth Report Blog for bringing the U.S. Trust study to my attention in this blog post.

Full post as published by Florida Probate Litigation Blog on June 12, 2008 (boomark / email).