Personal Estate Planning Ideas for Entrepreneurs

Personal estate planning isn’t something many first-time entrepreneurs spend time on, and rightly so. There’s a million different things that can be done, most overkill for the stage and circumstances of many entrepreneurs. With that said, there are a few items that are worth mentioning (note: this is not tax or legal advice and should not be construed as such).

Here are a couple personal estate planning ideas for entrepreneurs:

• If you are independently wealthy, or thoroughly convinced you’ll be wildly successful and are willing to pay the on going fees, consider gifting a portion of your seed stage co-founder equity (e.g. 10% – 30%) to a trust outside your estate since it has nearly no value for lifetime gift tax exemption purposes and can grow into something substantial to support your future generations (and will be outside the estate so it won’t have estate taxes when you die)
• If you are serious about selling your business, and/or are talking to potential acquirers before you’ve received a term sheet or letter of intent with a price (it’s key no price has been offered), consider getting a third party valuation that discounts the value for lack of marketability, and then donating a piece of the equity to a non-profit or private foundation, so that you don’t have to pay capital gains on it at time of sale and you get a tax deduction on the current value (you could donate the money after the sale but you’d pay full taxes on it before you can donate it, so the charity would receive less)

The second item is much more generally applicable, especially for entrepreneurs with a successful business that have some charitable intent. Personal estate planning is much more complicated than this but these are two ideas for entrepreneurs.

What else? What are some more personal estate planning ideas for entrepreneurs?