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Whats the Trump Effect on Estate Taxes

Whats the Trump Effect on Estate Taxes

Probably nothing, unless you plan to die soon! I happened to be with a client with whom I have worked since 1991, on the day President Trump was elected. That led us to examine the political climate over the past 26 years. We reminded ourselves that the 1980’s had been a Republican era (but Democrats had controlled at least one house of Congress). However, in 1992, President Clinton lead a Democratic sweep of the Congress. In 2000, President George W. Bush lead a Republican sweep followed by 2008, with President Obama sweeping the Democrats back into office, followed by the latest sweep by the Republicans under President Trump. Our country has been on a political roller coaster ride for the last three decades!

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As Seen in Digital Dealer - Why Equal is Not Fair

As Seen in Digital Dealer - Why Equal is Not Fair

“But I love all my kids equally and I want to treat them fairly!” exclaimed Ted, the exasperated business owner who was trying to figure out his estate plan. This sentiment is voiced over and over by my dealer clients leading to many discussions on ‘why equal is not fair’! It’s easy to relate to this concern as most of us have experienced what I call ‘the Christmas/Hanukkah Syndrome.’ That happens as you lay out your gifts on your bed or table and start figuring out whether you have bought the right number of gifts. “Let’s see, I have 3 gifts for John, but only 2 for Hannah, but the 2 for Hannah cost more than the 3 for John – how do I make this work?” When we apply the same thinking to our estate planning it can really get crazy.

I believe it is important to remember that when your children were growing up, you didn’t say, “I just paid $5,000 for braces for Ken, therefore I need to spend $5,000 on each of my other kids.” Clearly, you spent money for braces for Ken because they were needed and would do the same for your other children depending on their needs.

Read the complete article on the Digital Dealer Website website

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Are You Suffering the Christmas/Hanukkah Syndrome?

Are You Suffering the Christmas/Hanukkah Syndrome?

“But I love all my kids equally and I want to treat them fairly!” exclaimed Ted, the exasperated business owner who was trying to figure out his estate plan. This sentiment is voiced over and over by my dealer clients leading to many discussions on ‘why equal is not fair’! It’s easy to relate to this concern as most of us have experienced what I call ‘the Christmas/Hanukkah Syndrome’. “Let’s see, I have 3 gifts for John, but only 2 for Hannah, but the 2 for Hannah cost more than the 3 for John – how do I make this work?”

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As Seen in Digital Dealer Magazine - Four Ways to Keep Peace in the Family Business

As Seen in Digital Dealer Magazine - Four Ways to Keep Peace in the Family Business

Owning a business is hard; owning a family business is even harder. Learn how to prevent and resolve family business conflicts with these four simple steps.

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Succession Planning Techniques Often Overlooked

Succession Planning Techniques Often Overlooked

“Is there anything you would have done different than your father regarding estate planning?”  “Yes”, replied the son.

The son, now a highly successful auto dealer, was emphatic in his response.  “Dad was unwilling to do anything. He thought he would lose control.  We were lucky he died during good market conditions - our dealership products were hot and the real estate market allowed us to sell assets to pay the estate taxes.  We could have lost everything!”

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Family + Business = Harmony or Fireworks?

Family + Business = Harmony or Fireworks?

A business owner recently told me, “I have one brother who is my best friend and one who I don’t talk with, all because of business and financial issues.” Tragic yes, but not uncommon. Having worked with business owners and their families for over 30 years, I have witnessed situation after situation in which the family business has resulted in family heartache. Fortunately, that does not have to be the end result; there are many examples of family businesses being run successfully by harmonious family members. Some landmines that you need to avoid that will enable success in business operations include: 

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Succeeding the Old Fashioned Way

Succeeding the Old Fashioned Way

The look on my face when the 54 year old dealer told me that he was promoting his 28 year old son to be the GM was a dead give away. “Why is that a problem? – I was a GM at that age!, he said.” And obviously it worked out great for this dealer, so why was I questioning his decision to promote his son? The issue I told him is that he grew up in an entirely different set of circumstances than the world his son experienced and the maturity levels created by such are hard to replicate. 

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Planning Techniques

Planning Techniques

“Is there anything your father should have done that he didn't regarding his estate planning?" "Yes" said the son...

That question was posed by the father’s original dealership partner (now in his 80’s) to the son several years after the father’s death at a meeting in which I participated. The son, who is a highly successful auto dealer, was very emphatic in his response. “Dad was unwilling to do anything because he thought he would be losing control. We were lucky – the timing of his death was during good market conditions when our dealership products were hot and the real estate market allowed us to sell assets needed to pay the estate taxes. We could have lost everything!” 

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Living in Dad's Shadow - When Kin Can Cash In

Living in Dad's Shadow - When Kin Can Cash In

"I love coming to work every day!” exclaimed the 81- year old dealer. No doubt and he definitely still had plenty of gas left in his tank! Energetic and mentally sharp, his idea of “retirement” was to come in to work at 10:00 a.m. (“but I stay at least until 5:00 p.m.”). As the founder of his dealership empire, he was extremely proud of what he had accomplished and still felt he could contribute and run the business if he had to. So what’s the problem? 

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Family and Business = Harmony or Fireworks?

Family and Business = Harmony or Fireworks?

A dealer recently told me, “I have one brother who is my best friend and one who I don’t talk with, all because of business and financial issues.” Tragic yes, but not uncommon. Having worked with auto dealers and their families for 27 years, I have witnessed situation after situation in which the family business has resulted in lots of family heartache. Fortunately that does not have to be the end result and there are many examples of family dealerships being run successfully by harmonious family members. So what are the landmines that you need to avoid?

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Is Your Successor Ready to Take Over Today

Is Your Successor Ready to Take Over Today

I saw a cartoon recently in which the owner of a business said to his son as they gazed out of the window on the family business, “Someday Son, this will all be yours, unless I can come up with a better solution!” That statement echoes the sentiment of many dealers I’ve worked with who are worried that their son or daughter is not prepared to be able to lead the company if something happened to Dad today. 

The question that needs to be answered involves the following: Is your successor identified, trained, approved by the manufacturer/s, respected by management and able to run the company successfully today? This may involve your son or daughter, or possibly a key manager. Unfortunately, in most dealer’s situations, the answer would be “no” or “I hope so”, neither of which is a satisfactory answer.

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How to Attract and Retain High Performers for Your Business

How to Attract and Retain High Performers for Your Business
  • Do you have key employees who are telling you they want a piece of the action – an ownership interest in the dealership? 
  • Do you have key employees whom you want to retain in the dealership over the long term? 
  • Do you have highly compensated employees who are getting killed income tax-wise and want to know what you can do to help? 
  • Are you looking for ways to create greater incentives for your key employees? 

If you answered yes to any of the above questions, then you should consider utilizing some type of non-qualified deferred compensation plan(s) in your dealership. The Fortune 500 companies have been using NQDC plans for years to attract and retain their key employees and so should you. 

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I Love My Kids Equally but They Don't Produce Equally

I Love My Kids Equally but They Don't Produce Equally

“How do I resolve this issue? If I don’t address this, there will be a mess after I’m gone, but if I open up this can of worms, my life may be hell and my family will be in a uproar.” I asked this frustrated dealer if he was paying his sons the same amount and not surprisingly he said, “yes”. “Do they own equal amounts of stock?” Again, the answer was “yes”. Clearly he had identified the problem but did not know how to resolve it. In almost 25 years of working with car dealers, I have heard this story retold many times. Why? What is the impact upon Succession Planning? 

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Choosing Your Successor - Who Gets to Wear the Crown?

Choosing Your Successor - Who Gets to Wear the Crown?

During my first meeting with a client, he pointed to a picture of his two sons on his desk. The boys in the picture were 7 and 8 years old and both were wearing golden paper crowns. He said, “That’s my problem today, they both work in my business and both still want to be the one who wears the crown! 

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