Corporate Insurance – Randy Reynolds FAB Planning

Does your Business Qualify for the Small Business Gains Exemption?

import Dec 12, 2016

As a business owner, you may be aware that when you dispose of shares in your business you could receive an exemption on all or a portion of the capital gains that ordinarily would be taxable. This is due to the Lifetime Capital Gains Exemption which says that, for 2016, up to $824,176* of capital gains is exempt from taxation.

The Lifetime Capital Gains Exemption (LCGE) is available to individuals who are disposing of or deemed to have disposed of:

Qualified Small Business Corporation (QSBC) shares;
Qualified farm property; or
Qualified fishing property **.

The Corporate Estate Transfer

import Nov 21, 2016

If you are the owner of a successful company it is likely that you have retained profits or surplus cash in your corporation. If this is the case, chances are also good that this invested surplus is exposed to a high rate of corporate income tax. If this describes your company then you may be a candidate for the Corporate Estate Transfer. This strategy provides tax sheltered growth as well as maximizing the estate value of your company upon your death.

What is a Corporate Estate Transfer?

The Corporate Estate Transfer is an arrangement in which the company purchases a tax exempt life insurance policy on the life of the shareholder using corporate funds that are not needed for immediate business purposes. In doing so, the transferred surplus grows tax-deferred while the death benefit of the life insurance policy increases the value to the estate when the shareholder dies.

Family Business Planning Strategies

import Jul 18, 2016

67% are at Risk of Succession Failure

If you are an owner in a family enterprise, the chances of your business transitioning successfully to the next generations is not very good. This has not changed over the years. Statistics show a failure rate of:

67% of businesses fail to succeed into the second generation
90% fail by the third generation

With 80% to 90% of all enterprises in North America being family owned, it is important to address the reasons why transition is difficult.

The Corporate Extraction Strategy

import Dec 14, 2015

Transferring a Life Insurance Policy to a Corporation

The Corporate Extraction Strategy involves transferring a personally owned life insurance policy to a corporation for its fair market value (FMV). When handled properly, it will result in withdrawing capital from the corporation tax free!

The preferred candidates for this strategy:

Own a life insurance policy that they wish to maintain;
Own all the shares in a corporation;
Are usually older and/or would be rated or declined for life insurance due to health concerns.

The 4 Cs of Conflict-Free Family Businesses

import Jul 20, 2015

Focusing on growth is harder when your co-owners are your relatives

by Fred Pidsadny for ProfitGuide.com

Family-run businesses are like elastic bands—they can be stretched only so far, in different directions, before tensions cause them to snap. Those who run family businesses know that stress can often be elevated by forces that don’t exist in non-family firms, from hiring obligations and bloodline silos to next-generation financial demands to under-performing family members. It’s one thing to discipline or even fire a stranger, quite another to turf a brother or daughter. For such businesses, finding a successful balance is an ongoing challenge.

So how can family-owned businesses avoid conflict and focus on growth? For a number of years I’ve been working with a company run by three brothers, each with their own family and their own unique take on strategy and succession planning. They have benefited tremendously by learning and practicing what I call the four Cs of strategy execution for owner-managed businesses:

©iStockphoto.com/

Get Your Corporate Dollars Doing Double Duty

import Aug 19, 2014

Owners of very successful private corporations are intimately aware of the importance of cash flow. Many are very protective of how they allocate corporate capital so that business ventures are adequately funded and investment opportunities are not missed. An Immediate Financing Arrangement offers an opportunity to provide life insurance coverage and accumulate wealth on a tax-advantaged basis without impairing corporate cash flow.

What is an Immediate Financing Arrangement (IFA)?

An IFA is a financial and estate planning strategy that:

Combines permanent, cash value life insurance with a conservative leverage program allowing the dollars allocated to the life insurance premiums to do double duty by still being available for business and investment purposes.;
In the right circumstances and when structured properly so that all possible tax deductions are used, an improvement in cash flow could result.

Protecting Your Business

import Nov 14, 2012

While most business owners realize the benefits of corporate-owned insurance, many do not realize that flexible life insurance products such as universal life can provide them with the protection they need as well as a source of cash for business purposes.

Most business owners require insurance to:

Minimize their corporate tax bill
Fund a buy-sell agreement
Cover the loss of a key employee
Secure a loan
Fund a capital gains liability

With flexible plans like universal life, you have the option to pledge the Cash Value as collateral for lines of credit (or other loans) from third party lenders. this allows you to do one or several of the following: