Business Continuation Planning Chicago Illinois

Chicago Small Business Accountant

Updated July 21, 2015
Business Continuation Planning Chicago Illinois
 
What is business continuation planning?

Business continuation planning Chicago Illinois is the orderly transition of a business from one generation to the next. Why is this generally difficult? Taxes.

Let’s explain this through a couple of scenarios:

 

Let’s say that a business owner passes on, and no business continuation plan has either been put in place or begun. The Internal Revenue Service has guidelines established for the specific way that a business must be valued for estate tax purposes. Trust me, this isn’t terribly reasonable. For our example, let’s say that the entire estate is worth $5,000,000. This number is broken up as follows: $1,500,000 for the business, $500,000 in cash and securities, $200,000 in personal property and $2,800,000 in real estate. If the estate tax credit at the date of death is $2,000,000, then the estate would pay tax on $3,000,000 or roughly $1,650,000 in tax. If the business had been transferred to the next generation prior to the death, then the value of the estate would only be $3,500,000 and the tax would only be roughly $825,000. If in addition to the business being transferred, the real estate had been put into a trust, then there would be no estate taxes due at all.

 

Do not try to face this on your own.
 
Chris@AccountingSolutionsltd.com
 
Additional Accounting Articles and information on my firm can be found at
 
www.AccountingSolutionsLtd.com
 
Chris Amundson is the President of Accounting Solutions Ltd., a full service public accounting firm of Certified Public Accountants and Enrolled Agents handling the bookkeeping, accounting, tax preparation, and audit representation needs of Businesses, Estates, Trusts, and Upper Income Individuals.
 

Chris Amundson is President of Accounting Solutions Ltd. located in Chicago, Illinois

Chicago Accounting Firm & Tax Solutions for Small Businesses

Last updated on September 25, 2015
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