Many business owners are paralyzed by uncertainty over what the future may look like for their business and industry. But if you’re the owner of a closely held family business and are thinking about some form of retirement, you should consider taking advantage of a few tax provisions before the end of the year to help you, your company, and your family.
In the next 12 to 24 months, several tax laws will probably change. The lifetime gifting exemption of $5 million per person will likely be reduced and the long-term capital gains tax of 15% increased. In the fourth quarter of 2012, you can take advantage of current rates to start implementing the transition or sale of your closely held family business.
If your net worth is high enough, and your children are going to be taking over your company, then strongly consider using some or all of your $5 million gift exemption this year. (more…)