Avoiding the Final Tax Trap: Turning a Massive Liability into a Legacy

Overview

Background:

Our client, a seasoned business owner in his seventies with a multimillion-dollar real estate portfolio, faced significant tax liabilities upon his passing. Traditional options offered little comfort, forcing either asset liquidation or leaving his family burdened with debt.

Goals:

• Protect real estate assets from forced liquidation due to estate taxes.

• Maximize the value of existing assets through strategic tax planning.

• Secure a substantial, tax-free inheritance for his family.

Step 01: The Challenge

Tax Threat and Estate Vulnerability

Without proactive planning, the client's substantial real estate portfolio was exposed:

• Estate taxes could force his family to liquidate valuable assets.

• Idle cash flow from his properties was not optimized for wealth growth.

• Limited options to effectively use real estate assets for ongoing business investments.

Step 02: Our Solution

Strategic Corporate-Owned Insurance and Financing Plan

We devised a strategic, multi-layered approach:

• Used idle cash flow to fund a corporate-owned permanent life insurance policy, creating a tax-sheltered asset.

• Leveraged the real estate portfolio as collateral for additional financing.

• Provided immediate liquidity to reinvest in business operations without sacrificing growth.

Step 03: Results Achieved

Tax-Free Legacy and Continued Growth

Through this integrated strategy, the client successfully:

• Eliminated the risk of forced asset liquidation.

• Generated substantial tax-sheltered growth through corporate-owned life insurance.

• Secured additional capital to continue strategic business investments.

• Ensured a significant tax-free payout to clear debts upon passing, seamlessly transferring multimillion-dollar wealth to his family.

Our client transformed a potentially devastating liability into a lasting, secure financial legacy without needing to sell a single asset.

Take Action

If you’re a business owner with a growing real estate portfolio or increasing passive income, you could be closer than you think to triggering costly tax consequences. Let’s talk about how you can preserve your business tax advantages, grow your wealth, and build a tax-free legacy for your family—all at the same time.

Reach out to the Dundas Wealth team today to schedule your personalized consultation and explore strategies tailored to your situation.