Shaking Off Buy-Sell Agreements and Life Insurance for Business Owners: Implications and Planning in the Wake of Estate of Connelly v. United States

Private client associate Brian Balduzzi was part of a panel discussing the potential impacts of Estate of Connelly v. United States. For the 2023-2024 U.S. Supreme Court term, the Court will consider whether the proceeds of a life insurance policy taken out by a family business on a shareholder’s life for the redemption of his shares should be considered a corporate asset when calculating the value of the shares for federal estate tax purposes. The circuit split between the Estate of Connelly v. United States and Estate of Blount v. Commissioner present unique planning opportunities for attorneys, financial and wealth advisors, life insurance advisors and business owners to work collaboratively to review existing buy-sell agreements and corresponding policies, along with strategize and draft new agreements and policies, to ensure desired tax and business planning and goals are met. The roundtable curated a discussion among advanced practitioners on these legal and practical business concerns and offered background on the respective cases and best practices and opportunities in the future.