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Ready to retire and looking for a way to transfer ownership in your business? Concerned that too much of your wealth is tied to one asset? If you are the owner of a closely held business and are worried about potentially hefty tax bills when you sell some or all of your shares, you should consider a tax-smart alternative - an employee stock ownership plan (ESOP). An ESOP can allow you to diversify part of your stake in your company while simultaneously helping to secure its future profitability.

One of the more difficult challenges facing a business owner is the formulation of a viable and economically beneficial exit strategy at retirement. Typically, the main goals of such an exit strategy are 1) to identify a qualified buyer, and 2) to receive fair compensation for the business, which would, in turn, translate into a desirable retirement income.

Alex and Brad, both in their mid-forties, had just celebrated the tenth anniversary of Consulting, Inc., their market consulting business. The next morning, before going to work, Brad suffered a heart attack while jogging and died later that day. Alex suddenly lost his long-time business associate. What's more, after the estate was settled, he found himself with a new co-owner -- Brad's wife.

Most all closely held businesses, especially multi-owner corporations and partnerships need to have a buy-sell agreement in place. Individually owned businesses can also profit from the use of a buy-sell agreement. This is essential for smooth transition of ownership upon the occurrence of several events, namely the "Eight D's." We'll discuss each one individually in the corporate context, however, most would also apply to partnerships. In a single-owner business, the buyer could be key employee(s), a competitor, a supplier, or even a customer.

Whatever your motivation for selling your business, you'll only get one chance to maximize the return on your years of hard work. Do it the right way and you could get the price you want and reduce the impact of capital gains and estate taxes. Do it the wrong way and you might end up with a hefty capital gains tax bill and estate planning headaches.

One of the reasons so few family businesses survive into the second generation¹ is because the owners fail to adequately plan for their succession. Many owners simply wait too long to do business succession planning, so the business must be liquidated to pay estate taxes which are generally due nine months after death.

Procrastination. That's what many successful business owners do, instead of effectively planning for the future. Now that they have accumulated sizable wealth, they become immobilized by seemingly conflicting concerns: how to retain control of their assets as they approach retirement age, retain enough income to live on after retirement, minimize their children's estate taxes, and help provide for their families' security after they die. Mixed into the equation may be a desire to eventually pass on the business to the next generation.

As your business grows and you add staff, choosing the right benefits and retirement plans becomes more complicated. You have many options to choose from. That variety, however, gives you a better chance of picking a plan that more precisely meets your needs -- such as rewarding key employees, beefing up their savings, and providing incentives for them to stay with your company.

For many owners of closely held businesses, their business is not only the most significant asset they own, but also, essentially, their life. Deciding how to pass ownership interests on at retirement or death can be as much an emotional issue as a financial-planning concern.

Through your own philanthropic generosity-whether volunteering, supporting a charity as a benefactor, attending fundraisers or setting up a family foundation-you are educating your children about your values and teaching them to be generous. While you may identify your philanthropic values more formally in a family charitable mission statement, children learn a lot through observation.

A charitable remainder trust (CRT) may be an estate planning tool that fits well into your financial picture. A CRT is a type of trust generally used to donate appreciated assets to charity and reduce/eliminate capital gains taxes. Let's review the basics of a CRT and the benefits it can provide when planning your estate.

Are you hanging on to some low-basis, highly appreciated assets that you would gladly sell if you could somehow avoid losing much of the value to taxes? One solution might be an estate planning arrangement known as a charitable remainder trust. This type of trust may provide you with income tax deductions and other tax breaks, while enabling you to convert an appreciated asset -- such as stocks or bonds, real estate or a work of art -- into an income stream for life.

You may have heard from a colleague about the advantages of making gifts of cash or property during your lifetime. Estate and income tax savings are two of those benefits. But there are other considerations too.

When was the last time you reviewed your beneficiary designations for life insurance policies and retirement accounts? Very likely, the answer is "never." But you should review them periodically. Various life events can signal a need to review and possibly change your beneficiary designations. Consider whether any of the following events have occurred since you named your beneficiaries.

You have an estate plan; you probably even remember creating it-making the decisions and pulling together the documents was probably a time-consuming and tedious effort. The initial process of creating an estate plan can be so painful and involved that people may avoid reviewing it again for years.

Many people who plan carefully to keep income taxes at a minimum don't give any thought to estate taxes. They assume that estate taxes affect only the very wealthy. Not true. Currently, any estate worth more than $1.5 million may be subject to federal estate taxes æ at rates ranging as high as 47%. With so many dual-income families and the high value of real estate in many areas of the country, an estate of this size isn't necessarily a large estate.

It's fair to say that accumulating wealth is a primary goal for most investors; but the flip side of the coin is proactively preparing for the distribution of your legacy. Drafting an estate plan can help maximize the growth of your assets while minimizing estate taxes for your beneficiaries.

Many estate planning practitioners view the irrevocable life insurance trust (ILIT) as one of the most flexible and useful tools they can put to work on behalf of their clients. While the issue of where the ILIT fits into the overall estate planning process can be somewhat confusing, a closer look reveals its potential advantages.

Grantor retained annuity trusts (GRATs) can be an effective estate planning technique for transferring high-yield assets and/or appreciating property, such as small business interests, to children or other family members at a low - or no - tax cost. In recent years, though, GRATs have taken a backseat to other financial planning techniques. However, this has changed, as new strategies and developments make GRATs worth a second estate-planning look.

Like many other executives, you may have received stock options as part of your compensation package. To make the most of your options, you should know the federal tax consequences of receiving an option, exercising it, and eventually selling the stock.

Consider this scenario: You are about to retire and are offered a pension of either $3,000 per month during your lifetime or $2,500 per month over the lifetimes of both you and your spouse.

People are sometimes surprised to learn that the government not only taxes the income they earn while working, but it also can tax the accumulated estate built from their work. What can you do to help reduce the sting of federal estate and gift taxes and protect your family's inheritance? Start by looking at your will and beneficiary designations.

If you have recently thought about where you can best invest your hard-earned cash, you may have come up against the age-old question of whether you will do better in a taxable or tax-exempt investment.

The end of the year provides an ideal opportunity to reflect on the status of your personal finances and review your evolving goals and objectives for the year ahead.

If you are thinking about making a donation to a charity, you might want to consider making a gift of appreciated stock or mutual fund shares rather than a cash donation. A gift of appreciated property often provides increased tax benefits, along with the satisfaction of contributing to a cause you believe can make a difference.

Like most wealthy individuals, you'd probably like to pass as much of your estate as possible to your heirs. At the same time, you may have one, or many, charitable interests to which you'd like to donate money. To find the balance, considering a structured philanthropic giving strategy for your estate is a must.

The charitable remainder trust (CRT) is a tax-advantaged estate planning tool that allows you to plan for a future charitable gift while providing an income, lowering your taxes and reducing your estate.

Paying for a child's college education is an expensive proposition - but not an impossible one. With the right strategies, you can go a long way to meeting this challenge whether your child is still in preschool or already in high school.

In recent years, revocable living trusts have been touted as a simple, cheap supplement to wills. But are they? It's called a living trust because you set it up and put some or all of your assets into it during your lifetime. Typically, you serve as trustee which gives you control of the assets until death. After your death, they are distributed according to the terms of the trust document and don't go through probate, which can be costly and time-consuming.

What do Elvis Presley and you have in common? Absolutely nothing, you're probably thinking. But if your estate plan isn't in order, you may have the same problem he had before he died in 1977 at the age of 42. At his death, his estate was valued at over $10 million, but federal estate taxes and other estate settlement costs of more than $7 million reduced its net value to under $3 million¹. With a more carefully prepared estate plan, Elvis might have been able to leave more to his daughter and other family members, and less to the federal government.

For today's business owner, death can mark the beginning of a significant tax problem. The investment and sweat that went into building your business year after year could add up to a whopping federal estate tax bill for your heirs -- up to 47% of the combined value of your company and other assets.

A Life Settlement enables older individuals, businesses, and other organizations to sell life insurance policies they currently own - but no longer want or need - for an amount greater than the cash surrender value.

Say the words "life insurance" to some people, and you're likely to get a less than enthusiastic response. But, more and more frequently, people are discovering that life insurance can be a helpful financial planning tool. Life insurance offers a way for you to help provide for your family, protect your business, and make charitable gifts without reducing your estate.

No one likes to think about becoming disabled. But it happens far more often than you may think. According to the Social Security Administration, a 30-year-old worker has a three-in-ten chance of becoming disabled before reaching retirement age ¹. The Department of Health and Human Services estimates over 50 million people have some type of long-lasting health condition or disability.²

The average cost for a private room in a U.S. nursing home now exceeds $200 a day and is at $74,000 annually - up 5.7% from the amount last year¹. At this rate, the cost could quickly deplete almost anyone's assets. One way to protect yourself and your assets is to purchase a long-term care insurance policy - just in case.

You've heard the old investment adage, "Don't put all your eggs in one basket." It's good advice. A diversified portfolio should be at the core of any well-planned investment strategy. While a worthy goal at any age, it's especially desirable as your net worth grows over the years.

With the ongoing uncertainty of the stock market, people are continuing to investigate other financial vehicles, and annuities are just one of those options. Everyone has heard about annuities, but what actually is an annuity and why may they be a good retirement planning tool for you?

Years ago, when you found the right one, the only one for you, you promised to have and to hold. And, because you were faithful, you can now watch that $4-per-share stock trade at $124 in today's market. Unfortunately, the dividend payout, at about 3%, is inadequate for your income needs. You think about selling it all or diversifying, potentially doubling your dividend income, but you're reluctant because of the significant capital gains tax you would have to pay.

Think back to when you first started setting money aside in a long-term investment plan. Depending on when you began investing, you may have already seen your investments ride the ups and downs of shifting economic trends. Or maybe investing is a new experience and you're not quite sure what to make of your investment's performance amid economic and market shifts.

Taxes can take a chunk out of your investment returns; yet, many investors don't give much thought to taxes when they make investment decisions. While investment decisions shouldn't be based entirely on tax considerations, tax-efficient investing may make a significant difference in your net gain. Employing some of the following strategies could help you retain more of your potential investment earnings and lessen your tax obligation.

These days, some people may have a "sure-fire" way to time the stock market. Just check out the Internet. You can find screens advertising market timing services. A trip to your local library will yield an equal abundance of market timing theories in books, magazines, and other periodicals. And some of these theories may or may not work.

You may already participate in an employer-sponsored retirement plan and/or contribute to an Individual Retirement Account (IRA) or Roth IRA. If so, congratulations! You're one step ahead of many Americans when it comes to saving for retirement. But chances are you will still need additional retirement savings to secure your financial future and reach your retirement goals.

A solid foundation supports the floors and walls of the building above. Without it, the building may not be strong enough to withstand bad weather and years of use.

For most of us, the big worry about retirement planning is building a sufficient nest egg. But according to the Employee Benefit Research Institute, millions of Americans have Individual Retirement Accounts (IRAs) totaling $3.67 trillion, an historic high in 2005.⁽¹⁾. It may be that the trickier part of an IRA isn't putting money into it-but taking money out.

Most of us find it easier to earn and spend money than to save it. Planning and saving for retirement too often takes a back seat to other priorities. Why is procrastination the rule, rather than the exception when it comes to retirement planning?

For years, you've been investing in an IRA or employer-sponsored retirement plan, and, thanks to the benefits of tax-deferred growth potential, you now have a considerable nest egg - enough to enjoy a comfortable retirement and pass a tidy sum on to children and grandchildren. Or so you think. Unfortunately, after taxes, only a small percentage of your retirement savings may be left.

Who should benefit from your retirement assets - you and your family or the federal tax coffers? The answer is easy: you and your family, of course. Achieving that goal is more difficult. These days, very few people stay at one job for their entire careers. So, by retirement, you and your spouse may have assets in four or five - or even more - employer-sponsored retirement plans and individual retirement accounts (IRAs). How you utilize those accounts at retirement can make a big difference in the amount of assets available to pass on to children or other heirs.

Planning and saving for retirement, like cleaning out the attic, may be something you figure you'll get to later. But when "later" arrives at retirement age, you may not have the financial resources to enjoy your golden years.