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Department of the Treasury Issues Proposed Regulations to Eliminate Discounts for Family Controlled Entities

Advanced sales alerts

New Proposed Section 2704 Regulations were just released by the Department of the Treasury and were published in the Thursday, August 4th Federal Register. These long awaited regulations appear to eliminate lack of control discounts for family controlled entities such as family limited partnerships, limited liability companies and closely held corporations.

It is important to keep in mind that these rules are proposed and a public hearing is scheduled for December 1st. The new rules will generally not take effect until 30 days after the proposed regulations become final. This may present a window of opportunity to take advantage of discount gift and sale transactions.

Also, please note that in limiting the discounts available for gift and sale transactions, additional opportunities for life insurance may open up.

As we begin to get a better understanding of the new proposed rules and how they will affect sales opportunities, we will publish additional Advanced Sales Alerts.

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