NJ Lawyers | Middlesex County Estate Planning Law | Rahway
Rahway | 07065Family limited partnerships (FLPs) are established estate planning vehicles that are a legitimate wealth-preservation and asset-protection strategy. Contact family limited partnership attorney, Vince Maverick, and the estate planning lawyers at Maverick & Peters, LLC if you are concerned about family limited partnerships. They have advised many families in Rahway and throughout Middlesex County NJ. Because of the potential federal gift and estate tax benefits and potential asset protection benefits, FLPs are widely marketed by a variety of attorneys, CPAs, CFPs, and other planners. Limited partnership require the payment of annual fees, and the failure to pay these fees can mean that the entity will eventually be stricken by whatever governmental entity formed it in the first place. If the entity is stricken, it ceases to exist as far as the state and IRS is concerned. From an asset protection and an estate planning viewpoint, making the parent the General Partner of the FLP is the single most common mistake in FLP structuring. The reason is that charging order protection relies on the General Partner to not make distributions to a limited partnerís interest for the benefit of a creditor. However, if the parent gets sued, the creditor could probably persuade the court to enter an order compelling the parent to make a distribution to the Parentís LP interest, thus totally subverting the charging order protection. If the parent is both the General Partner and the only Limited Partner, then a court may deem that since the parent owns all the interests, there is no partnership and the parent simply owns the FLPs assets outright (thus negating the charging order protection and any hoped-for tax benefits). A common error in FLP structuring is to place all of the clientís significant assets into a single FLP, thus creating a large, single target for creditors to relentlessly attack. As with most other asset protection methods, an FLP will be more effective if it is just one of several diverse methods used to protect assets. The family limited partnership attorneys at Maverick & Peters, LLC are ready to answer your questions and discuss your options. Residents of Rahway NJ can greatly benefit from their sound advice. Contact them today. Some people will go to great trouble to fund their FLPs, but never get around to actually gifting the LP interests to the children. This results in wasted opportunities to take advantage of the annual unified exclusion, and ultimately in higher estate taxes paid by the parentsí estate. It also unnecessarily exposes the LP interests to the parentsí creditors during the interim. By gifting limited partnership interests directly to a child, the possibility arises of creditors or an ex-spouse of the child getting possession of (or at least a charging order against) the limited partnership interest. By placing the parents gifting the limited partnership interest to a spendthrift trust instead, claims against the limited partnership interest by the childís creditors and ex-spouses are avoided. The FLP must be treated as a business entity, and should not be used as a family trust. All the investment holdings of the FLP should be for business or investment purposes, and all payments made by the FLP should facilitate those purposes. The FLP should absolutely not be used for personal family purposes, such as to hold the family home or fund college educations. If the family requires money from the FLP, then it should either be borrowed from the FLP at current interest rates or (much better) distributed from the FLP to the various trusts holding the interests, and from there given to family members. Family limited partnership attorney, Vince Maverick, can help you navigate through the complexities of family limited partnerships in Rahway NJ. Get the help you deserve by calling him today. Family Limited Partnerships Lawyers serving South Plainfield, Avenel, Bound Brook, Clark, Colonia, Dunellen, Edison, Fanwood, Fords, Green Brook, Iselin, Metuchen, Middlesex, North Plainfield, Piscataway, Plainfield, Rahway, Scotch Plains, South Bound Brook, Warren, Woodbridge, and throughout Middlesex County.
Rahway | 07065
Flp Family Limited Partnership Lawyers in Rahway, NJ
07065 Estate Planning Law Firm
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Maverick & Peters, LLC 114 Oak Tree Ave, South Plainfield, NJ 07080 (908) 899-1661 http://www.SouthPlainfieldAttorneys.com/
Family Limited Partnership Lawyers in New Jersey
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