Two years ago, Mr. Harris couldn't scrape together enough funds to start a business that delivered healthy meals. So, he decided to approach his mother for an early bequest. The money would be coming to him anyway, he figured, and she would be able to see him put the cash to good use.
As an entrepreneur you might be on the verge of rolling out the next big thing in the marketplace. Should you ask your folks for an early inheritance to foot the bill?
The Wall Street Journal considered this matter in an article titled “Cash-Strapped Entrepreneurs Seek Early Inheritances,” with ideas for parents and their entrepreneurial heirs alike.
In an economy starting to show some signs of life, many business plans that have been mothballed are being reconsidered. As an heir, is it ok to want your inheritance now? As a parent, is it ok to give it up early? Well, yes to both.
All parties concerned must be mindful of tax issues, as well as future financial needs that include planning for retirement, old age, health issues and even the rest of the estate.
The original article explores the emotional aspects of this issue, too. Indeed, it can be difficult to ask for an early inheritance and, conversely, it can be difficult being asked for an early inheritance.
Regardless, whether you are asking or being asked, you will need competent legal, accounting and financial counsel to guide you. You do not want the potentially competing dreams of business success and a secure retirement to turn into nightmares for all concerned.
Please visit our website for information on elder law and estate planning issues, and sign up for our free monthly e-newsletter. The archive on our website contains numerous blog posts on these legal areas as well. You can also “friend” us on Facebook (R Christine Brown) to receive periodic posts on elder law issues.
Reference: The Wall Street Journal (August 19, 2013) “Cash-Strapped Entrepreneurs Seek Early Inheritances”