Chapter 16 - § 16.9 • CONCLUDING THOUGHTS

• Jurisdiction: Colorado

§ 16.9 • CONCLUDING THOUGHTS

Any attorney who contemplates assisting a client with an FLLC or FLP for estate planning should associate with an experienced attorney if the attorney does not have the appropriate level of knowledge and experience for the planning the client desires.

Where a client's circumstances do not support the conclusion that the client would have a significant non-tax reason for forming an FLLC or FLP, the attorney should consider whether the client is willing to accept an arrangement under which the client would not retain any right to income from the entity or control of the entity. Otherwise, the entity will probably be disregarded for estate tax purposes and discounts would then not be available.

Of equal concern is the need for the client to maintain the formalities to prevent the IRS or courts from disregarding the...