Avoiding the Investment Company Trap When Forming FLPs and LLCs

Originally appeared in Estate Planning, a Thomson Reuters publication. Copyright 1999 Thomson Reuters/Tax & Accounting.

Although family limited partnerships (FLPs) and limited liabilities companies (LLCs) (sometimes referred to collectively in this article as “FLPs”) are a commonly used estate planning technique, clients, promoters and even some practitioners may be unaware of the investment company rule, which may inadvertently cause taxation on the formation of an FLP.

To read the full article, click here.