Last Gasp Estate Planning: The Formation of Family Limited Liability Entities Shortly Before Death

Family limited partnerships have been popular gift and estate tax planning vehicles for many years. In recent years, family limited liability companies (LLCs) have also become common, particularly in those states that have updated their statutes to take the check-the-box regulations into account. LLCs with more than one member are usually classified as partnerships for federal income tax purposes. In a typical structure, when there is adequate planning, the donors form a limited partnership or an LLC (jointly, \u27family limited liability entity\u27 or FLLE), to which they contribute assets expected to appreciate in value. This article will focus on such use of FLLEs as found in the Strangi case and offer proposals for reform