The use of a commercial lease to rip off minority owners in a closely held business
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There is a common misconception that ownership equals control. But in many businesses—especially those participating in the Small Business Administration’s (SBA) 8(a), Women-Owned Small Business (WOSB), or Service-Disabled...more
In the months preceding the general election in 2024, the owners of many closely held businesses who had not yet given much thought to the disposition of their future estates, including their businesses, decided they should...more
Earnouts are a form of contingent consideration that the buyer of a business pays to the seller in the period following the acquisition, based on the business achieving various financial metrics related to its performance...more
New York’s Commercial Division has long prided itself on adopting practices and procedures similar to the federal courts. A recent amendment to its rules takes a further step in that direction by mandating initial disclosures...more
On July 4, 2025, President Trump signed the One Big Beautiful Bill Act (OBBBA), the most significant US tax overhaul since the 2017 Tax Cuts and Jobs Act (TCJA). The OBBBA includes critical changes impacting family offices,...more
The “One Big Beautiful Bill Act” (the “Act”) was signed into law last week, on July 4. As promised by the White House, the Act extends – i.e., purports to make “permanent” – many of the otherwise expiring provisions that were...more
In Norman v. Strateman, No. A170356, 2025 WL 1802786 (Cal. App., 1st Dist., June 20, 2025), the California Court of Appeal held that a settlement of derivative claims reached among all shareholders of a close corporation was...more
If you’ve been around closely held businesses long enough, you know that a transfer of money between a business and its owner, or between two related businesses, is sometimes characterized by the parties as a loan (“related...more
Business succession planning and estate planning are often linked together, particularly in the case of closely held family businesses. In the case of a shareholder who wishes to pass along their shares of an S corporation as...more
It’s a fact that the great majority of multi-owner, closely held business entities are run by working owners. In many if not most instances the working owners realize the financial benefits of ownership primarily in the form...more
Successful business owners know one tried-and-true method to grow and scale is through acquisition. In today’s competitive and complex marketplace, the competition is fierce for businesses with a proven track record and the...more
At the end of 2024, the Knesset enacted significant legislative updates within the framework of the Arrangements Law that completely revamp how “closely held companies” are taxed in Israel. Section 76 of the Income Tax...more
Charitable organizations are dependent, in no small part, upon the financial support of many successful business owners. The generosity of these individuals and their organizations may be a manifestation of several factors...more
As a new administration takes office, CHBs should prepare for significant policy changes across immigration, employee benefits, and employment and labor law that could impact their businesses in 2025....more
If you’ve worked with the owners of closely held businesses for even just a few years, you have realized they are only half joking when they complain about having the government as a partner. Consider how much federal, state,...more
On 11/4/24, the Internal Revenue Service issued a warning to taxpayers regarding the dangers of engaging with promoters of fraudulent tax schemes that involve donating ownership interests in closely held businesses, often...more
As we noted in our Fraud and Commercial Loan Transactions: Post-Judgment Legal Strategies Webinar, fraud in commercial loan transactions presents significant challenges for creditors seeking to recover funds. Once a judgment...more
Almost exactly one year ago, we wrote about the go-to line of New York case law for business divorce litigants hoping to secure injunctions: a substantial and ever growing body of authority holding that involuntary loss or...more
Today we’re going to talk about one of the more common ways that a majority owner can rip off minority owners in a closely held business. And that is by causing the company to enter into a lease with an affiliate of the...more
Recently, the U.S. Supreme Court ruled unanimously in Connelly v. United States, that the valuation of a decedent’s shares in a closely held corporation for federal estate tax purposes must include insurance proceeds received...more
Decisions, Decisions - The owners of a closely held U.S. business will have to make many difficult decisions during the life of the business. Among the earliest of these is the so-called choice of business entity, the...more
With the looming elections, tax planners have taken time to consider what the future of Estate and Gift Tax planning might be under the new Congress. Every new Congress considers changes to the Internal Revenue Code of 1986,...more
In Connelly vs. United States (602 U.S. 257, June 6, 2024), the Supreme Court unanimously ruled that in a redemption of a deceased shareholder’s shares of stock, the corporation’s fair market value should include the proceeds...more
Business divorces take place in all types of private companies, including those owned and operated by family members. But families that are willing to engage in thoughtful planning can head off some of the internal conflicts...more
A key benefit to families with taxable estates may be about to go away. The Tax Reform Act of 2017 incorporated numerous tax reductions into U.S. law, with one significantly increasing the ability of taxable estate owners to...more