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Messrs. Warder and DeVol introduced Betsy and Robert to
Charles G. Cheleden, an attorney licensed in the State of
Pennsylvania. Mr. Cheleden reviewed decedent’s existing trust
documents and will.
In February or March 1993, Messrs. Cheleden and Warder
described to Betsy and Robert an estate plan that used family
limited partnerships. In a letter dated March 9, 1993, Mr. Warder
recommended using two family limited partnerships, each headed by
a corporate general partner, one for Betsy and her family and one
for Robert and his family. In promoting this arrangement, Mr.
Warder indicated the primary advantages of the program were (1)
lowering the taxable value of the estate, (2) maximizing the
preservation of assets, (3) reducing income taxes by having the
corporate general partner provide medical, retirement, and “income
splitting” benefits for family members, and (4) facilitating family
and charitable giving. In addition, he stated that “All of the
4(...continued)
Fortress trains and educates professionals on the use of
family limited partnerships as a tool to (1) reduce
income tax, (2) reduce the reported value of property in
an estate, (3) preserve assets, and (4) facilitate
charitable giving. The Fortress Plan recommends
contributing assets to a family limited partnership with
a corporate general partner being created for control
purposes. The Fortress Plan also suggests that shares of
stock of the corporate general partner or an interest in
the family limited partnership be donated to a charity.
To facilitate the plan, Fortress licenses the use of
copyrighted limited partnership agreements and
shareholders’ agreements.
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Last modified: May 25, 2011