Dual Wills For Business Owners
The use of “dual wills” is an estate planning tool available to business owners in order to transfer the value of their shares to their beneficiaries in a tax efficient manner. Having dual wills means that business owners have one will that deals with all assets of their estate except for their shares in a privately held company, and they have a second will dealing exclusively with the shares in such company. The will dealing with all assets except for the shares in the company is subject to an estate administration tax of up to 1.5% of the total value of the assets dealt with in that will. However, the will dealing with the shares in the private company is not subject to the estate administration tax. In other words, estate administration tax will not paid on the value of the shares. Given the significant value of certain businesses the tax savings that can be realized here far outweigh the minimal planning cost of drafting dual wills.