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What are some options for transferring ownership of a business?

There may come a time when a small business owner in Saint Paul will need to hand the reins over to another individual or entity. According to the U.S. Small Business Administration, there are several options for transferring ownership of a business.

One way to transfer ownership of a business is through an outright sale. The advantage of selling your business in full is that the transfer of ownership takes place immediately and the former business owner is paid at once. Some people may choose this transfer of ownership if they are financially unable to keep running their business. An attorney can assist in an outright sale by ensuring that all necessary regulations are followed, as well as advise on tax matters and fulfilling any existing contracts.

Federal law recognizes certain estate tax deductions

As the saying goes, two things that are certain in life are death and taxes. Sometimes, these two things intertwine. In 2018, if a U.S. citizen dies leaving an estate worth $11,180,000 or more, they may need to file an estate tax return. While this may not affect many people in Minnesota and elsewhere, those who are subjected to the federal estate tax likely do not want to see the size of their estate reduced, as it means there will be less left to their heirs. They may wonder if there are any deductions they may use to reduce the amount they will owe in federal estate taxes.

As it turns out, the Internal Revenue Service recognizes several deductions a person may use to reduce the amount they must pay in estate taxes. One of these deductions is the marital deduction. All assets of the gross estate that pass on "outright" to a surviving spouse may be deducted. In addition, there is the charitable deduction. If the decedent leaves assets to certain qualifying charities, they may deduct these contributions from their gross estate.

Don't navigate hiccups in real estate transactions alone

Summer is a popular time to buy and sell a home in Minnesota. Those looking to buy or sell a home may think that they can handle the matter on their own. However, complications could arise during the process that they might never have expected and are totally unable to deal with. These oversights can be costly.

Therefore, those looking to buy or sell a home this summer may want to consider seeking the advice of an attorney who handles real estate matters. The professionals at Chandler and Brown Ltd. aim to make their clients' real estate transactions run efficiently and effectively. They are experienced in assisting their clients in executing purchase and sales contracts, reviewing easements to determine who has the right to use the property and protecting their clients' interests at closing.

How can one avoid feuds between heirs regarding the family cabin?

Many Minnesotans are fortunate to own a cabin on a lake or in the North Woods where they can spend their weekends and vacations. A break from the rat-race can certainly be relaxing, and the family cabin is often just the place to do that.

Most people on vacation aren't necessarily thinking about estate planning. However, when their vacation time is over and they return to their day-to-day lives, it can pay to develop a comprehensive estate plan. People may already have executed a trust or will that states what is to be done with their assets upon their death. However, when it comes to the family cabin, being detailed can be key.

Estate planning with probate in mind

"Probate" may be an unwelcome term to those who have designed their estate plans specifically to avoid it. However, many people in Minnesota may have very limited experience with the probate process. Therefore, it is good to have a basic understanding of probate. This way, a person can design an estate plan that takes probate into account, and should one be chosen to administer a probated estate, they may be able to anticipate what duties this entails.

When a person passes away, with some exceptions, their estate will go through "probate." Probate is simply the procedure undergone to determine whether the deceased's will is legally valid. It also lays out the rules the executor of the estate should follow when winding up the deceased's estate. If a person died without executing a will or trust, then an executor of the estate will be named through probate and the deceased's assets will be distributed. In either case, the executor of an estate has numerous duties.

What if one cannot find a deceased loved one's will or trust?

Some people in Saint Paul may have taken the wise step of creating a will or trust years ago, but as time marches on, what happens to these documents? Are they in a safe deposit box? Are they being held by an attorney? Were they simply stashed away in a filing cabinet in the home office?

Not being able to locate a person's original will or trust document can cause issues once that person passes away. A person's will or trust provides the directions on how they want their estate distributed upon their death. If a person does not have a will or trust when they die, their estate will be subject to the laws of intestate succession. This means that the state will dictate which of the deceased's survivors will inherit the deceased's estate and it may not be who the deceased would've chosen.

Business start-ups may benefit from a business plan

Many people in Minnesota may dream of one day owning their own business. Some will even leave the "rat-race" of their current job to open their own business. One part of business planning that should be completed before the business opens its doors is the creation of a business plan. A well-drafted business plan guides the business as it starts up and serves as a reminder as to how the business should be set up, how it should operate and how it can grow. In addition, investors and partners may want to see a business plan before getting involved in the enterprise.

There are two types of business plans: traditional business plans and lean startup business plans. Traditional business plans are detailed and comprehensive. There are generally nine items a traditional business plan can address (although it is not necessary to include every single item). Traditional business plans can include: an executive summary, a description of the business, a market analysis, a description of how the business will be organized and managed, a description of the business's service or product line, the business's marketing and sales strategy, any requests for funding, financial projections and an appendix.

Potential homeowners in Minnesota face financial challenges

Many young adults in Minnesota may have once anticipated becoming homeowners. After all, owning a home is a sign that a person is able to manage their finances responsibly. Moreover, people just like the idea of having a house and land that is theirs and theirs alone to do with as they wish. However, for some young adults, homeownership is becoming a distant dream.

Two years ago, homeownership across the nation dropped to its lowest rate since the 1960s. After the housing bubble burst in the mid-2000s, many people had to foreclose on their homes, and the number of people owning their own homes, which sat at 69.2 percent in 2004, tumbled. While the rate of homeownership has experienced a slight rebound, rising from 62.9 in 2016 to 64.2 in 2017, those wishing to buy a home still face challenges.

Estate planning with the federal estate tax in mind

Like just about any financial transaction these days, the handing down of property through a will or intestacy in Minnesota does not necessarily happen tax-free. In fact, depending on the value of one's estate, the federal estate tax may apply.

Calculating a person's taxable estate starts with determining what their gross estate is. The gross estate includes all of the decedent's property, including cash, real estate, trusts, annuities, business interests and insurance, among other pieces of property. For purposes of the estate tax, the value of the decedent's assets will be what the fair market value is, even if the decedent paid more or less for them when they acquired them.

Why are revocable trusts a useful estate planning tool?

Some people in Saint Paul may have executed a will and think that their estate planning duties are done. After all, the will specifies who will inherit what once the testator dies, so what more is needed? While a will can certainly accomplish that goal, it will have to go through the time-consuming, public, and costly probate process before the person's assets can be distributed to their heirs. Therefore, those who want to avoid probate and keep their financial information private may want to consider executing a trust, either in place of or in addition to, a will.

Some people may think that trusts are only for the mega-wealthy who have many valuable assets to pass on. However, a revocable trust could prove to be useful for a person of just about any financial means. Revocable trusts bypass probate, meaning they are shielded from the public and can immediately pass on funds to the trust beneficiaries.

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St. Paul, MN 55101

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