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Speculation arises over estate of late Buffalo Bills owner

| Mar 28, 2014 | Uncategorized

Although an estate-planning document may be advisable for everyone, it is practically essential for a business owner. The recent estate questions surrounding the late Ralph Wilson Jr. illustrate this need.

As professional football fans may know, Ralph Wilson Jr. was the sole owner of the Buffalo Bills. His late passing left behind an estate estimated at around $870 million. Depending on whether Wilson Jr. had a will or trust in place, his estate could be liable for estate taxes. 

An attorney that specializes in estate planning knows that probate is often the least favorable forum for estate tax savings. In this case, the value of Wilson Jr.’s estate implicates a potential federal tax rate of 40 percent. However, there are a number of trust instruments that can help business owners and individuals reduce the amount of estate taxes they would otherwise owe upon their death.

For example, if Wilson Jr. indicated that he wanted ownership of the Bill to transfer to his wife, the entire transfer would be exempt from estate taxes, at least during the surviving wife’s lifetime. Wilson Jr. could also have allocated ownership shares of the franchise to different family members and/or entities. In the case of a transfer to a charitable organization, estate taxes might also be avoided.

Payment options are also available for satisfying estate taxes. The federal government might agree to a payment schedule that extends over several years. An irrevocable life insurance trust could be established for the purpose of paying estate tax. If sold immediately after an owner’s death, a business may also be able to avoid capital gains taxes, although the estate taxes might be somewhat higher.

Source: Buffalo Business First, “Estate taxes may hold key to Bills’ future after Wilson’s death,” Alissa Kline, March 25, 2014