{"id":21969,"date":"2024-06-07T15:42:16","date_gmt":"2024-06-07T15:42:16","guid":{"rendered":"https:\/\/www.thinkadvisor.com\/2024\/06\/07\/supreme-court-rules-against-estate-in-business-buy-sell-case\/"},"modified":"2024-06-07T15:42:16","modified_gmt":"2024-06-07T15:42:16","slug":"supreme-court-rules-against-estate-in-business-buy-sell-case","status":"publish","type":"post","link":"https:\/\/blog.lifeinsurance-orleans.ca\/index.php\/2024\/06\/07\/supreme-court-rules-against-estate-in-business-buy-sell-case\/","title":{"rendered":"Supreme Court Rules Against Estate in Business Buy-Sell Case"},"content":{"rendered":"<div class=\"media_block\"><a href=\"https:\/\/feeds.feedblitz.com\/-\/899088728\/0\/thinkadvisor\/\"><img decoding=\"async\" src=\"https:\/\/images.thinkadvisor.com\/contrib\/content\/uploads\/sites\/415\/2023\/11\/Supreme_Court_Building_Washington_BB_640x640.jpg\" class=\"media_thumbnail\"><\/a><\/div>\n<div><img decoding=\"async\" src=\"https:\/\/images.thinkadvisor.com\/contrib\/content\/uploads\/sites\/415\/2023\/11\/Supreme_Court_Building_Washington_BB_640x640.jpg\" class=\"ff-og-image-inserted\"><\/div>\n<p>The Supreme Court agreed with the 8th Circuit.<\/p>\n<p>The stock redemption agreement created no offsetting liability because it was not set up in a way that would cut the economic value of the supply company\u2019s shares,&nbsp;Justice Clarence Thomas wrote in the opinion.<\/p>\n<p>\u201cA redemption obligation could, for instance, require a corporation to liquidate operating assets to pay for the shares, thereby decreasing its future earning capacity,\u201d he wrote in a footnote. \u201cWe simply reject Thomas [Connelly]\u2018s position that all redemption obligations reduce a corporation\u2019s net value.\u201d<\/p>\n<p>When valuing the business for estate tax purposes, the estate must assess how much Michael Connelly\u2019s shares were worth when he died, before the supply company paid to redeem his shares, Thomas adds.<\/p>\n<p>\u201cA hypothetical buyer would thus treat the life-insurance proceeds that would be used to redeem Michael\u2019s shares as a net asset,\u201d Thomas writes.<\/p>\n<p><em>The U.S. Supreme Court building in Washington, D.C. (Credit: Bloomberg)<\/em><\/p>\n","protected":false},"excerpt":{"rendered":"<p>The Supreme Court agreed with the 8th Circuit. The stock redemption agreement created no offsetting liability because it was not set up in a way that would cut the economic value of the supply&#46;&#46;&#46;<\/p>\n","protected":false},"author":1,"featured_media":21970,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[],"tags":[1],"jetpack_featured_media_url":"https:\/\/blog.lifeinsurance-orleans.ca\/wp-content\/uploads\/2024\/06\/supreme-court-rules-against-estate-in-business-buy-sell-case.jpg","_links":{"self":[{"href":"https:\/\/blog.lifeinsurance-orleans.ca\/index.php\/wp-json\/wp\/v2\/posts\/21969"}],"collection":[{"href":"https:\/\/blog.lifeinsurance-orleans.ca\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/blog.lifeinsurance-orleans.ca\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/blog.lifeinsurance-orleans.ca\/index.php\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/blog.lifeinsurance-orleans.ca\/index.php\/wp-json\/wp\/v2\/comments?post=21969"}],"version-history":[{"count":0,"href":"https:\/\/blog.lifeinsurance-orleans.ca\/index.php\/wp-json\/wp\/v2\/posts\/21969\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/blog.lifeinsurance-orleans.ca\/index.php\/wp-json\/wp\/v2\/media\/21970"}],"wp:attachment":[{"href":"https:\/\/blog.lifeinsurance-orleans.ca\/index.php\/wp-json\/wp\/v2\/media?parent=21969"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/blog.lifeinsurance-orleans.ca\/index.php\/wp-json\/wp\/v2\/categories?post=21969"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/blog.lifeinsurance-orleans.ca\/index.php\/wp-json\/wp\/v2\/tags?post=21969"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}