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Law Educator, Esq.
Law Educator, Esq., Attorney
Category: Estate Law
Satisfied Customers: 117379
Experience:  Experienced in Trust and Succession Law, including Louisiana Laws
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About 6 years ago I obtained Sbarra Music LLC from you. I

Customer Question

About 6 years ago I obtained Sbarra Music LLC from you. I have a will naming my daughter Karen Sbarra, a resident of NJ, as executor and inheritor of my estate. My assets include:
house, car, personal belongs and 3 bank accounts: personal checking. savings, and Sbarra Music LLC. Karen's name is ***** ***** 3 accounts as co-owner. My concern is: Sbarra Music is a small business with limited tax deductions. I am sole owner as president.
If a name Karen as an officer of the company drawing a salary, would this account for additional tax deduction?
Also, are there any additional ways to lessen inheritance taxes upon my death and make for a smoother transition of my assets to my daughter? Would all 3 bank accounts be subject to inheritance tax?
Submitted: 2 years ago.
Category: Estate Law
Expert:  Law Educator, Esq. replied 2 years ago.
Thank you for your question. I look forward to working with you to provide you the information you are seeking for educational purposes only.
Yes, Karen drawing a salary would mean that would lower the profits of the LLC and result in lower taxes for you resulting from the LLC. She would have to be taxed on her salary of course.
Yes, there is an easier way to avoid any inheritance taxes at all and that is to name Karen as beneficiary or joint tenant with right of survivorship on all of your accounts and assets now. If she is a joint tenant with rights of survivorship, there is no probate and no inheritance, she just takes over ownership of everything at your death. So if you list her on the bank accounts as joint tenant with right of survivorship, when you die, those accounts are her accounts without probate or without inheritance tax. On the LLC, you list her as a member and amend the articles of incorporation to reflect that, then have a membership agreement that states in event of death of a member the surviving member or members will take the deceased member's share of ownership.

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