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Reflections on Winding Down While Gearing Up

  • By  Scott D. Calhoun
  • |
  • December 11, 2018

Unbelievably, it seems, another year is coming to a close. This time of year engenders reflection and reminiscence, both in our business and personal lives. From a business perspective, it is time to begin gathering information to evaluate performance and plan for the upcoming year. At home, families gather and share stories, celebrate achievements, and mourn losses. As advisors, all these influences affect us, not only in our own lives but also in the lives of our clients.

The Power of Planning

We know that careful and thoughtful planning is vitally important, and we know how difficult it can be to devote the necessary time for appropriate planning. For that reason, now is an especially important time to nudge, encourage, cajole (threaten?) our clients to engage in planning.

From an investment standpoint, recent market forces have created some unease and discomfort. Helping clients establish – and stick with – a plan that suits their individual needs will provide stability and confidence.

Tax & Estate Planning

The recent tax law changes are about to make their impact known. For some unsuspecting clients, the impact will not necessarily be positive. There may still be time for many of these clients to take advantage of planning opportunities.

With the increased standard deduction and loss of some itemized deductions, charitable giving may be an area on which clients can focus. Opportunities may also still exist to maximize advantages of the new depreciation rules and the qualified business income deduction for certain pass-through businesses. Clients should be encouraged to explore these or other possible strategies with their tax advisors.

And of course, the combination of business and family factors creates an environment which is particularly conducive to engaging in estate planning. The current tax laws have simplified estate planning issues for many clients from a tax perspective, but non-tax issues often create even more problems, and failure to put in place a workable estate plan can create a tremendous amount of discord and dispute among family members.

Recent celebrity examples demonstrate how acrimonious these conflicts can be, but the same issues also affect ordinary people. Putting a plan in place and making sure all family members and others involved are aware of the plan – these steps can go a long way to preventing unnecessary conflict.

Avoiding Conflict

And, speaking of conflict (and other entanglements), proper planning and proactive steps involving business organization and structure can eliminate or severely lessen the effects of conflict. Good legal counsel can help you or your clients implement the right structure and systems up front, which can avoid conflict and save substantial costs later on. If frictions or fissures begin to develop, consider using or recommending a mediator early in the process to help find a workable solution with the least amount of pain and expense.

So, my thoughts for the end of the year are these: remember to plan for yourself and encourage your clients to plan for themselves. Effective plans eliminate stress and encourage productive action, enabling positive results.

And, finally, enjoy time with friends and family. These relationships form the foundation for our ability to meet the unpredictable challenges ahead.

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Author Bio

Scott serves as Ironstone’s legal counsel and has more than 25 years’ experience in corporate law. He has a broad base of experience in the formation and structuring of all types of business entities and non-profit organizations as well as in mergers and acquisitions. Scott advises clients on a full range of business matters, including business entity formation, securities offerings, trademark registration and related agreements, lease negotiations, stock or asset acquisitions, employment agreements, partnership agreements, franchise agreements and related issues, secured lending or other financial transactions, shareholder agreements, and LLC operating agreements. Mr. Calhoun also has significant experience with estate planning, wills and trust drafting, and estate administration. Mr. Calhoun has served as general corporate counsel for a large number of small and medium size businesses. As corporate counsel, he advises clients on the full range of business legal matters described above, and he also consults on general business issues faced by those clients. His counsel also includes planning and implementation advice concerning asset protection and business succession issues, which often entails proper use of trusts and other planning vehicles. In the broader area of estate planning, Scott has significant experience with estate tax matters, drafting of wills, life insurance trusts, and other estate planning documents, and estate administration.