Funding Capital Gain Tax | Business Owner Solutions
Life insurance can also be an effective way to fund the tax
liability that arises at death.An individual who owns shares in a corporation, a
partnership interest, or business assets (as in the case of a
sole proprietorship) will be deemed to have disposed of
these properties at death. As a result, a tax liability may
arise in the form of capital gains and recaptured capital cost
allowance. If funds or other assets are not available to pay
the tax liability, the shares or partnership interest may have
to be sold, or business assets may have to be liquidated,
possibly for a price below the fair market value.
Life insurance can provide the funds needed to pay the tax liability that results from the capital gains and recaptured depreciation triggered by an individual’s death. Life insurance is a particularly valuable funding vehicle if the beneficiaries want to retain the property or if the market conditions will not provide the estate with an amount equal to the fair market value of the property. The individual could own the life insurance policy, or it could be owned by the corporation or partnership and dispersed to the individual’s estate after death.
Options:Each business has unique needs, call us and one of our licensed experienced Insurance Advisor in the field of developing solutions for business owners shall be happy to assist; or simply have a quick quote by clicking on one of the options as under:-
Permanent Life Insurance (Online Quote) - permanent insurance will payout one day sooner or later to offset tax burden on the estate.
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