Page 43 - MetalForming December 2017

(100 shares of voting stock, kept by Larry, and 10,000 shares of nonvoting stock to be sold to the IDT). The dis- count of 40 percent results in a price to Richard of only $7.2 million. The entire transaction is tax-free to Larry: no capital gains tax, no income tax on interest received. What’s the cost to Richard? Not one penny. Profits (in reality the future cash flow) of Alsace will pay the $7.2 million note.
2) Life insurance. Since Larry and Cheryl were insurable in 2005, we would
have bought about $11 million (set up to be free of all taxes) in second-to-die life insurance. My insurance consultant noted that the premiums would total about $10,500 per $1 million.
3) Family limited partnership (FLIP). The ‘investment’ assets total $12.1 mil- lion, but only $11 million would be transferred to a FLIP. The IRS allows a 35-percent discount, making the FLIP assets worth only $7.15 million for tax purposes.
4) Gifting program. Larry and Cheryl
have eight grandchildren, so together with their three children that leaves 11 gift recipients. The maximum tax-free gift was $11,000 in 2005. So Larry and Cheryl together could make a $22,000 gift to each, or a total of $242,000 per year.
How can you protect yourself, your business and your family from becom- ing victims like Larry, Cheryl and Richard? When your advisors complete your estate plan, ask them to show you how the plan passes all of your wealth to your heirs intact. If you are worth $5 million (or any amount), the entire $5 million will go to your heirs, with all taxes, if any, paid in full. What if 100 percent of your wealth, according to the plan, does not get passed intact? Get a second opinion.
For more on this subject, visit www.taxsecretsofthewealthy.com or call me, Irv, at 847/767-5296. Or, e-mail irv@irvblackman.com. MF
Spotlight on PMA
education, social events and industry net- works. Connect with your local district to establish relationships with peers and colleagues, enhance business development opportunities through networking, and promote the growth of your company’s greatest asset—your employees. Visit www.pma.org/districts to learn about activities in your area.
Blackman on Taxes
Manufacturers Build Relationships with Suppliers at District Events
The PMA Tennessee, Twin Cities and West Michigan Districts held successful suppliers nights this fall where industry suppliers showcased their capabilities and presented the latest technologies to manufacturers in the region. Designed for a range of industry personnel, including business owners and managers, plant managers, shop foremen, engineers and sales executives, these district table-top events are a one-stop-shop for manufacturers looking to connect with suppliers and service providers to the metalforming industry.
PMA’s 16 districts across the country provide members with local access to
PMA Welcomes its Newest Members
• Acquisition Asset Management LLC, Burr Ridge, IL • AlphaUSA, Livonia, MI
• GSG (Scovill) Fasteners LLC, Clarksville, GA
• Metal Impact LLC, Elk Grove Village, IL
• Reynolds Services, Inc., Greenville, PA
• Uelner Precision Tools & Dies, Inc., Dubuque, IA
Join PMA and experience the power of membership! Contact Janet Krall at 216/901-8800 or jkrall@pma.org with questions.
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MetalForming/December 2017 41
Upcoming Calendar of Events
December 4-5, MFG NXT Roundtable and Learning Session, Nashville, TN December 5-6, Deep Draw Technology Seminar, Cleveland, OH
December 13, MFG NXT Learning Series: Succession by Design Webinar
Visit www.pma.org or contact PMA at 216/901-8800 or info@pma.org for details about these upcoming events.