Upcoming Newsletter for Leimberg Information Services, Inc.-Nine FAQs Separating Fact From Fiction-U.S. Supreme Court's Decision in Connelly Est.
My upcoming article for Leimberg Information Services Inc. (LISI), which should be out within the next week or so, addresses nine FAQ's about the United States Supreme Court's decision in Connelly Est. v. Internal Revenue Service.
The questions that I address and answer in that newsletter are:
Q1. After the United States Supreme Court’s decision in Connelly Est., should estate planners be encouraging clients to revisit or review current buy-sell agreements?
Q2. Do all redemption buy-sell agreements need to be changed in light of the Supreme Court’s decision.
Q3. Did the United States Supreme Court either expressly or impliedly overrule or criticize the Eleventh Circuit’s decision in Blount Est. v. Comr.?
Q4. Did the United States Supreme Court either acknowledge or resolve, expressly or impliedly, any alleged circuit split in its Connelly Est. decision?
Q5. In its opinion in Connelly Est., did the United States Supreme Court rule out a subject company’s redemption obligations ever having a material adverse impact on the valuation of the subject company at the enterprise level?
Q6. Must a qualified business appraiser consider the entire buy-sell agreement in valuing an interest pursuant to the fair market value standard of value, notwithstanding the United States Supreme Court’s opinion in Connelly Est.?
Q7. When tasked with appraising a deceased owner’s interests held subject to a buy-sell agreement for tax purposes at the fair market value standard of value, what must a business appraiser do?
I'll tease a sample from the answer to this question by listing just the steps, but I've included neither the comments nor the application of the rules pertaining to each question to the facts in Connelly Est.
Step 1: Was the owner’s death a triggering event under the buy-sell agreement? If yes, proceed to Step 2.
Step 2: What’s the response to the occurrence of the triggering event pursuant to the buy-sell agreement?
Step 3: Determine how the price that the subject company may have to pay can or must be paid, i.e., must be in cash, can be paid in cash, in installments, or any combination thereof, and whose preference controls regarding payment options, i.e., subject company or representative of the deceased owner.
Step 4: Evaluate the subject company’s exact redemption installment payment obligation, including the following considerations:
Q8. Some pundits have made much out of the United States Supreme Court’s silence about IRC Sec. 2703-was that important?
Q9. What are the big lessons from the Connelly Est. case?
And here's my conclusion to the newsletter:
"I believe that the true legacy of the United States Supreme Court’s decision in Connelly Est. will ultimately be that it will be the catalyst for business owners to at least address their buy-sell agreements, far more than the actual legal effect of the decision past the poor beneficiaries of the Connelly Estate."
As the mythical Sgt. Phil Esterhaus used to end roll call each week on Hill Street Blues: “Let’s be careful out there.”
My Upcoming Presentations and Upcoming Items of Note:
领英推荐
Upcoming Presentations:
June 27, 2024-1:00 p.m. EDT-2:30 p.m. EDT (on Leimberg Information Services Inc. (LISI)-no continuing education credits available): (w/ Robert Keebler, CPA,PFS,MST,AEP,Distinguished ) How To Properly Structure Gifts Through Spouses: Doing the Spousal Gift Tango Without Getting Caught in the Smaldino Trap.
June 28, 2024-3:00-4:30 p.m. EDT (on Leimberg Information Services Inc. (LISI)-no continuing education credits available): Planning for the Surviving Spouse.
July 2, 2024-11:00 a.m. EDT-12:30 p.m. EDT (on Leimberg Information Services Inc. (LISI)-no continuing education credits available): The Countdown to 2026: Designing, Presenting, and Implementing Large Transfers for Clients While Avoiding Donor’s Remorse and Malpractice Lawsuits (w/Alan Gassman).
July 5, 2024-4:00 p.m. EDT-5:30 p.m. EDT (on Leimberg Information Services Inc. (LISI)-no continuing education credits available): (w/ Edwin Morrow III) United States Supreme Court Unanimously Affirms in Connelly v. Internal Revenue Service: Navigating Ramifications of the United States Supreme Court Decision-With Drafting Suggestions!!!
July 10, 2024-1:00 p.m. EDT-2:30 p.m. EDT (on Leimberg Information Services Inc. (LISI)-no continuing education credits available) (w/ Jonathan G. Blattmachr ): It’s a Debate with Jonathan Blattmachr & Paul Hood: Do the Assets Inside a Grantor Trust Receive a New Fair Market Value By Virtue of the Grantor’s Death, Even Though Those Assets Aren’t Includible in the Grantor’s Estate?
July 12, 2024-4:00 p.m. EDT-5:30 p.m. EDT (on Leimberg Information Services Inc. (LISI)-no continuing education credits available): (w/ Edwin Morrow III) A Planner's Cheat Sheet for Evaluating Estate Planning Tools & Techniques: Part 1 - A Special Re-Broadcast.
July 18, 2024-11:00 a.m. EDT-12:30 p.m. EDT (on Leimberg Information Services Inc. (LISI)-no continuing education credits available): The Wild, Wild West of Estate Planning: Estate Planning for Unmarried Couples.
July 26, 2024-2:00 p.m. EDT-3:30 p.m. EDT (on Leimberg Information Services Inc. (LISI)-no continuing education credits available) (w/ Jonathan G. Blattmachr ): It’s a Debate: Pre-Mortem Probate-Blessing or Curse?
July 30, 2024-11:00 a.m. EDT-12:30 p.m. EDT (on Leimberg Information Services Inc. (LISI)-no continuing education credits available) (w/ Leah Del Percio ):How End-of-Life Estate Planning Can Significantly Affect Post-Death Estate and Trust Administration.
September 3, 2024-1:00 p.m. EDT-2:30 p.m. EDT-Estate Planning for Income Tax Reduction (for @Strafford-continuing education credits available): (w/ Edwin Morrow III).
September 25, 2024-2:00-3:00 p.m. EDT-FPA webinar for The American Heart Association. I'm co-presenting with Klementina X. Sula in a 60-minute webinar session entitled "At the Intersection of Estate Planning & Philanthropy: Considerations and Best Practices for Professional Relationships Between a Philanthropic Professional and a Professional Advisors."
September 26, 2024-4:20-5:20 p.m. CDT (49th Annual Notre Dame Tax & Estate Planning Institute, an in-person event at Notre Dame in South Bend IN with many presenters, September 26-27, 2024)-I'm co-presenting with Edwin Morrow III on "Trust Modifications and Trust Terminations:? Unintended Tax Consequences and How To Avoid Them."
Upcoming Items of Note:
I’m working on an article with John "John A" Warnick for submission to Leimberg Information Services Inc. (LISI) entitled “A Wake-Up Call to the Estate Planning Advisory Community.”
I’m almost finished with the first draft of An Estate Planner’s Tool Book Second Ed. With Edwin Morrow III and four new 90-minute webinars entitled “A Planner’s Cheat Sheet to Evaluating Estate Planning Tools and Techniques,” where we’ll cover every estate and charitable planning tool and technique that we cover in the book. Look for them soon!!!
I'm finally working on my next book, which has a working title of Emotionally Intelligent Estate Planning!!!
And I'm also collaborating on another article on estate planning on a series of close to death planning faux pas that can make post-death administration more difficult with John "John A" Warnick.
Until next time, sursum corda, y'all!!!
Paul