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Is Creating A Family LLC The Right Choice For You_

While thereu2019s nothing new about family LLCs, more and more earners in the high-income bracket are establishing these as an effective way to give protection to the assets theyu2019re worked hard to earn, and develop wealth across generations.<br><br>

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Is Creating A Family LLC The Right Choice For You_

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  1. Is Creating A Family LLC The Right Choice For You?

  2. While there’s nothing new about family LLCs, more and more earners in the high-income bracket are establishing these as an effective way to give protection to the assets they’re worked hard to earn, and develop wealth across generations. If you’re someone who has worked all your life, and wants your hard-earned wealth and assets to be passed down to your kids, their kids, and other members of the family without having to worry about such things as gift and estate taxes, talking to Miami accountants about establishing a family LLC could afford you the protection you seeking.

  3. Although used to keep earnings within families and protect assets from such things as tax liabilities, family LLCs can also be beneficial to those in the high-earning bracket, long before their passing. Let’s take a closer look: Providing financial protection Often used for estate planning purposes, LLCs offer legal protection from personal liability to its members, should bankruptcy, debt or lawsuits arise. Family LLCs help to shield investments such as cars, homes and personal bank accounts.

  4. Reducing estate tax liabilities As a method of estate planning, family LLCs are highly effective because they reduce the taxes owed by children on inheritances left by the deceased. Additionally, they lower any gift taxes owed for the inheritance offered to children while the individual is still alive. Maintaining control over assets

  5. It’s easy to maintain control once a family LLC has been established. Even though your family members hold shares in the assets of the LLC, they aren’t permitted to vote over the changing of your wealth management plan. This means that you’re free to buy, sell, trade or distribute your assets as you see fit. Other family members are also restricted from selling their share of the LLC, withdrawing from the company altogether, or transferring their membership somewhere else. What this essentially means is that parents are able to control their assets and protect them from any financial decisions younger LLC members may make.

  6. It’s important to note however, that gifting shares to younger LLC members does come with gift taxes, but tax benefits that are significant in nature, allow you to give more while the value of your estate is lowered. Tax benefits As the manager of a family LLC, non-managing members are your children. Because LLC units that don’t have management rights are less marketable, the value of any units that you transfer to them are often heavily discounted, sometimes by as much as 40% of their market value. This means that you are able to gift your children amounts beyond the existing gift limit of $15,000 without gift taxes having to be paid.

  7. If this all sounds tempting but a little complex, talking to an experienced accounting firm in Coral Gables could help make things clearer, and should a family LLC be the right decision for you, they will help you set one up with ease. Not everyone can benefit from a family LLC, but for high-earners, they offer fantastic asset protection and can help preserve family wealth for generations to come.

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