• Skip to primary navigation
  • Skip to main content
  • Skip to primary sidebar
  • Skip to footer

Nirenstein, Horowitz & Associates P.C.

Estate Planning | Making a Difference One Family at a Time

An Estate Planning Law Firm
Making a Difference One Family at a Time

Call Now: (860) 548-1000

Attend a Complimentary Seminar
  • Facebook
  • Instagram
  • LinkedIn
  • Pinterest
  • RSS
  • Twitter
  • YouTube
  • Home
  • Our Firm
    • About Our Firm
    • Careers
    • Client Testimonials
    • Meet Our Team
  • Services
    • Asset Protection & Business Planning
    • Estate And Gift Tax Figures
    • Estate Planning
    • LGBTQ Estate Planning
    • Loss of a Loved One
    • Pet Planning
    • Powers of Attorney
    • SECURE Act
    • Special Needs Planning
    • Trust Administration and Probate
  • Elder Law
    • Alzheimer’s Disease
    • Caregiver Information
    • Emergency Medicaid & Nursing Home Planning
    • Guardianship & Conservatorship
    • Hospice Care
    • Medicaid Planning
  • Resources
    • Complimentary Estate Planning Worksheet
    • Complimentary Medicaid/Long-Term Care Calculator
    • DocuBank
    • Elder Law Resources
      • Glastonbury Elder Law Resources
    • Estate Planning Articles
    • Estate Planning Checkup
    • Estate Planning Definitions
    • Estate Planning Presentations
    • Estate Planning Seminars
    • Estate Planning Techniques
    • Frequently Asked Questions
      • Asset Protection and Business Planning
      • Elder Law & Medicaid
      • Estate Administration
      • Estate and Gift Tax
      • Estate Planning
      • Frequently Asked Questions for Families Without an Estate Plan
      • Incapacity Planning
      • In-Home Elder Care
      • Irrevocable Trusts
      • LGBTQ Estate Planning
      • Living Trust
      • Medicaid Planning
      • Nursing Home Asset Protection FAQs
      • Probate
      • Probate Avoidance
      • SECURE Act 2.0
      • Trust Administration
      • Wills
    • Newsletters
    • Probate Resources
      • Probate Resources
    • Published Books
    • Reports
      • Advanced Estate Planning
      • Basic Estate Planning
      • Estate Planning for Niches
      • Trust Administration
  • Seminars
  • Communities We Serve
    • Fairfield County
      • Darien
      • Fairfield
      • Stamford
    • Hartford County
      • Avon
      • Hartford
      • Simsbury
      • West Hartford
    • Litchfield County
      • Watertown
    • Middlesex County
      • Middletown
      • Old Saybrook
    • New Haven County
      • Middlebury
      • New Haven
    • New London County
      • Groton
      • Old Lyme
      • Stonington
    • Tolland County
      • Mansfield
    • Windham County
      • Woodstock
  • REVIEW US
  • Blog
  • Contact Us
Home » Estate Planning » Life Insurance Can Be Part of a Creative Estate Plan

Life Insurance Can Be Part of a Creative Estate Plan

June 7, 2022 by Barry D. Horowitz, Estate Planning Attorney

buy-sell aggreementEveryone is well aware of the fact that life insurance can be used to bolster the inheritances that you will be leaving to your loved ones. This being stated, there are some other utilizations that can provide targeted solutions, and we will look at some of them in this post.

Succession Planning for Business Partners

If you are a partner in a small business, you have to consider the fallout if your partner passes away. Their ownership interest would be owned by their estate, and you would have no control over the actions that are taken by the family of the decedent.

And of course, your partner would be in the same position if you die first. To address this type of situation, you can use a buy-sell agreement called the cross-purchase plan.

You and your partner would determine the value of an ownership interest in the business, and you would take out life insurance policies on one another. The proceeds would equal the agreed-upon value of a share in the business.

When one partner dies, the other partner will collect the life insurance proceeds, and they will be used to buy the ownership interest from the deceased partner’s estate. There is also an entity purchase or stock redemption plan, and the business entity would purchase the decedent’s share.

A buy-sell agreement can also be used to facilitate retirement or the opportunity to step away to pursue other interests, and the funding can potentially come from a different source.

Inheritance Balancing

Let’s say that you own a brewpub, and it has grown into a huge moneymaker with wholesale accounts to augment the business that you do in house. Your son decided to make the business his career, and he works alongside you every day.

The only other child that you have is a daughter who went to college out of state. She got a job in that state, and she is happy with her life. Your business is your most valuable investment, and you are definitely going to leave it to your son, and you don’t want to split ownership interests.

In a situation like this, you can use life insurance to balance the inheritances that you will be leaving to your two children. The proceeds can be calculated to equal the value of the business, and your daughter would be the beneficiary.

Estate Tax

There is a federal estate tax with a 40 percent maximum rate, and here in Connecticut, we have a state-level estate tax. These taxes are only a factor for high-net-worth individuals, because there are multimillion dollar exclusions that can be used to transfer a certain amount tax-free.

If your estate is going to be exposed to taxation, you could establish an irrevocable life insurance trust. You could convey policies that you already own into the trust, and the trust can purchase life insurance policies with funds that are transferred into the trust.

After your passing, the companies would pay out life insurance policies to the trust, and the money could be used to cover all or some of the estate tax responsibility.

Attend a Complimentary Seminar!

You will learn a lot if you explore this website because we have hundreds of blog posts and other written materials that you can access at no cost. This being stated, you can come away with a great deal of information in a very efficient manner if you attend one of our complimentary seminars.

In addition to the knowledge that you will gain, you have an opportunity to make an initial connection with our firm. These events are held at desirable locations, so it is pleasant way to spend a little bit of your spare time.

You can see the dates if you head over to our seminar page, and if you decide to join us, follow the instructions to register.

Take Action Today!

If you have already decided that it is time to work with a Glastonbury, CT estate planning lawyer to put a plan in place, we are here to help. You can send us a message to request a consultation appointment, and we can be reached by phone at 860-548-1000.

  • Author
  • Recent Posts
Barry D. Horowitz, Estate Planning Attorney
Barry D. Horowitz, Estate Planning Attorney
Founding Partner and President at Nirenstein, Horowitz & Associates PC
Barry D. Horowitz is a founding partner and president of the law firm of Nirenstein, Horowitz & Associates, P.C. He received his diploma from the Loomis Chaffee School and his Bachelor of Arts from Bennington College, where he dual majored in philosophy and music.

Mr. Horowitz was awarded his Juris Doctor degree with honors from the University of Connecticut School of Law. While attending law school, Mr. Horowitz received the American Jurisprudence Award in Legal Ethics and the Nathan Burkan Award.

After graduation from law school, Mr. Horowitz continued his legal education at New York University School of Law where he received a Post Doctorate Law Degree in Taxation. He has also recently received a national achievement award.

Mr. Horowitz is admitted to practice before all the state courts in the State of Connecticut and the United States District Court.

Mr. Horowitz was selected for Super Lawyers in 2021.
Barry D. Horowitz, Estate Planning Attorney
Latest posts by Barry D. Horowitz, Estate Planning Attorney (see all)
  • Take Precautions to Protect Your Legacy - September 12, 2023
  • Regular Reviews and Updates of Your Estate Plan Are Essential - August 24, 2023
  • Estate Planning Tips to Help You Protect Your Family - August 8, 2023
Share our Content:

Filed Under: Estate Planning

Other Articles You May Find Useful

estate planning for single seniors
Tackling Unique Estate Planning Challenges for Single Seniors
letter of last instructions
The Last Note: Crafting a Comprehensive Letter of Final Instructions
charitable trusts
Exploring the Tax Benefits of Charitable Trusts
incentive trust
A Trust Can Provide Incentives
estate planning tips
Estate Planning Tips to Help You Protect Your Family
estate planning myths
Debunking 5 Common Estate Planning Myths: Protecting Your Future with Facts

Primary Sidebar

Nirenstein, Horowitz & Associates

Upcoming Seminars

Estate Planning Seminar

Date: October 17

Venue: Canton Community Center, 40 Dyer Avenue, Collinsville, CT, 06019, United States

Estate Planning Seminar

Date: October 18

Venue: Cheshire Public Library, 104 Main Street, Cheshire, CT, 06410, United States

See all Seminars

Follow Us

  • Facebook
  • Instagram
  • LinkedIn
  • RSS
  • Twitter
  • YouTube

TESTIMONIALS

Blog Subscription

Our blog gives you the most up-to-date estate planning news. Sign up today to receive our regular updates!

  • This field is for validation purposes and should be left unchanged.

WESTPORT OFFICE

8 Wright Street, Suite 107
Westport, CT 06880
Phone: (860) 548-1000
Fax: (860) 761-1070
preserveyourestate_sidbr_map

Somerset Square

200 Glastonbury Boulevard, Suite 202
Glastonbury, CT 06033-4418
Phone: (860) 548-1000
Fax: (860) 761-1070
preserveyourestate_sidbr1_map

Office Hours

Monday8:30 AM - 5:00 PM
Tuesday8:30 AM - 5:00 PM
Wednesday8:30 AM - 5:00 PM
Thursday8:30 AM - 5:00 PM
Friday8:30 AM - 5:00 PM

Footer

footer-logo
  • Facebook
  • Instagram
  • LinkedIn
  • RSS
  • Twitter
  • YouTube

The information on this website is for general information purposes only. Nothing on this or associated pages, documents, comments, answers, emails, or other communications should be taken as legal advice for any individual case or situation. The information on this website is not intended to create, and receipt or viewing of this information does not constitute, an attorney-client relationship.

Privacy Policy | Contact Us | Disclaimer | Site Map | Powered by American Academy of Estate Planning Attorneys

© 2023 American Academy of Estate Planning Attorneys, Inc.