by NFS | Jun 27, 2012 | Archives
Do You Know What a Forced Liquidation Can Do to the Value of Your Business?
If liquidation is forced on a disabled business owner or on the executor of a deceased business owner, it can quickly become public knowledge that there is pressure to dispose of the business, and these results can be anticipated:
- Sale of business assets at greatly reduced prices.
- Elimination of the disabled business owner’s or surviving family’s primary source of income.
- Sacrifice of any goodwill value that might have facilitated sale of the business as a going concern.
- Difficulty in collecting accounts receivable.
- Immediate demand by creditors for settlement of their claims.
- Possible liquidation of other estate assets to pay business debts.
The liquidation value of a business is unpredictable and may be substantially less than the value of the business as a going concern.
The Alternative… A Planned Liquidation:
In some situations, the liquidation of a business interest at an owner’s death or disability may not be just an appropriate decision. It may, in fact, be the only possible outcome under either of these circumstances:
- The success of the business is completely dependent on the personal skill and experience of the owner.
- There is no successor management in the form of a capable family member, a co-owner, a key employee interested in purchasing the business or an outside buyer.
In these circumstances, the question then becomes:
Will the liquidation take place on a forced basis, or will it be planned in advance to allow for the most advantageous disposition possible? |
When liquidation of the business at an owner’s death or disability is the only viable alternative, the primary objective should be to plan in advance for an orderly liquidation that results in the greatest possible value for the disabled owner or surviving family. Please contact our office if we can help.
To view the complete NFS Business Briefs Newsletter for June 2012, click here.
by NFS | Jun 4, 2012 | Archives
Filing a past due return may not be as difficult as you think.
Taxpayers should file all tax returns that are due, regardless of whether full payment can be made with the return. Depending on an individual’s circumstances, a taxpayer filing late may qualify for a payment plan. It is important, however, to know that full payment of taxes upfront saves you money.
Here’s What to Do When Your Return Is Late
Gather Past Due Return Information
Gather return information and come see us. You should bring any and all information related to income and deductions for the tax years for which a return is required to be filed.
Payment Options – Ways to Make a Payment
There are several different ways to make a payment on your taxes. Payments can be made by credit card, electronic funds transfer, check, money order, cashier’s check, or cash.
Payment Options – For Those Who Can’t Pay in Full
Taxpayers unable to pay all taxes due on the bill are encouraged to pay as much as possible. By paying as much as possible now, the amount of interest and penalties owed will be lessened. Based on the circumstances, a taxpayer could qualify for an extension of time to pay, an installment agreement, a temporary delay, or an offer in compromise.
Taxpayers who need more time to pay can set up either a short-term payment extension or a monthly payment plan.
- A short-term extension gives a taxpayer up to 120 days to pay. No fee is charged, but the late-payment penalty plus interest will apply.
- A monthly payment plan or installment agreement gives a taxpayer more time to pay. However, penalties and interest will continue to be charged on the unpaid portion of the debt throughout the duration of the installment agreement/payment plan. In terms of how to pay your tax bill, it is important to review all your options; the interest rate on a loan or credit card may be lower than the combination of penalties and interest imposed by the Internal Revenue Code. You should pay as much as possible before entering into an installment agreement.
- A user fee will also be charged if the installment agreement is approved. The fee, normally $105, is reduced to $52 if taxpayers agree to make their monthly payments electronically through electronic funds withdrawal. The fee is $43 for eligible low-and-moderate-income taxpayers.
What Will Happen If You Don’t File Your Past Due Return or Contact the IRS
It’s important to understand the ramifications of not filing a past due return and the steps that the IRS will take. Taxpayers who continue to not file a required return and fail to respond to IRS requests for a return may be considered for a variety of enforcement actions.
If you haven’t filed a tax return yet, please contact us. We’re here to help!
by NFS | May 31, 2012 | Archives
Today is May 31st, the last day of “Disability Insurance Awareness Month”…Let’s end the month off with one final…PAYCHECK POP QUIZ: What are the odds that you’ll suffer a long-term disability during your career? Check out the video below for the answer—is it higher than you expected?
by NFS | May 31, 2012 | Archives
First Time Homebuyer Seminar
HarborOne U, Mansfield MA
Thursday, June 7th, 2012
6:00 pm to 9:00 pm
Make a well-informed decision when you buy your first home. This seminar provides you the opportunity to get answers to your many questions from the professionals involved in the home buying process. Professionals include Mortgage Originator, Buyers Agent & Realtor, Real Estate Attorney, Insurance Agent, Tax Advisor and Home Inspector. A light dinner will be served.
Register today as seating is limited.
by NFS | May 30, 2012 | Archives
What Is a Trust?
The word “trust” is applied to all types of relationships, both personal and business, to indicate that one person has confidence in another person.
For our purposes, a trust is a legal device for the management of property. Through a trust, one person (the “grantor” or “trustor”) transfers the legal title to property to another person (the “trustee“), who then manages the property in a specified manner for the benefit of a third person (the “trust beneficiary“). A separation of the legal and beneficial interests in the property is a common denominator of all trusts.
In other words, the legal rights of property ownership and control rest with the trustee, who then has the responsibility of managing the property as directed by the grantor in the trust document for the ultimate benefit of the trust beneficiary.
A trust can be a living trust, which takes effect during the lifetime of the grantor, or it can be a testamentary trust, which is created by the will and does not become operative until death.
In addition, a trust can be a revocable trust, meaning that the grantor retains the right to terminate the trust during lifetime and recover the trust assets, or it can be an irrevocable trust, meaning that the grantor cannot change or terminate the trust or recover assets transferred to the trust.
Trusts can be used:
- To provide management of assets for the benefit of minor children.
- To assure the grantor that children will benefit from trust assets, but will not have control of those assets until the child is older.
- To manage assets for the benefit of a disabled child, without disqualifying the child from receiving government benefits.
- To provide for the grantor’s children from a previous marriage.
- As an alternative to a will (a “revocable living trust”).
- To reduce estate taxes and, possibly, income taxes.
- To provide for a surviving spouse during his/her lifetime, with the remaining trust assets passing to the grantor’s other named beneficiaries at the surviving spouse’s death.
Trusts are complex legal documents and are not appropriate in all situations. Before establishing a trust, you should seek qualified legal advice.
To view the complete NFS Retirement Readings Newsletter for May 2012, click here.
.jpg)
