OPINIONISTA: The Financial Wellness Coach: Reap the tax benefits of a carefully constructed succession plan

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Question: I have an engineering company and I want to put together a succession plan and exit strategy. I have three young engineers whom I would like to retain and eventually make co-owners. They would take over the business from me. How can I do this ...

I usually use a structure called a preferred compensation plan for business owners who are in a similar position to you.

The business must enter into an agreement with each employee and grant them salary increases on condition that these increases, less tax, are used to fund an endowment policy.

 

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