It has been some time since my last “update letter” and I hope you are all well. Since retiring from GenSpring, I have continued my work on repeal of the Estate Tax, and its impact on family businesses, and I thought it might be time to get back in touch with another “update.”
Much of my semi-retirement (is there really such a thing?) has been taken up with my new role as President of Family Enterprises USA (FEUSA) . Its sole mission is to promote family businesses and their essential, yet too often ignored, contribution to job growth. Having worked with the FEUSA Board for five years, I am excited to have this new role. Each year we conduct a Family Business Survey covering their challenges and statistics; if you would like a copy of the 2019 results contact me by email or phone; see below.
To take on this role, I have retired as CEO of Policy and Taxation Group, (PATG), but remain Founder and Chairman. Mike Zarrelli, who has a long career “working The Hill” formerly with Amway and Mayor Giuliani, is PATG’s new CEO and I will continue to work with Mike to eliminate the estate tax.
As part of this mission, both PATG and FEUSA continue to work with Frank Luntz to understand voter attitudes toward Socialism and Capitalism or Economic Freedom. The results are revealing: only 31% of voters identify themselves as “capitalist”. The public typically has little idea of what defines the actual population, known as the “1%.” When they do find out, there is a lot less support for raising taxes on them. These findings are helpful in refining our messaging. Let me know if you would like a copy of the 3 page Luntz survey summary report.
Closer to home, I am now a Principal Advisor and Chair, Founding Board of Directors for Drucker School Global Family Business Institute at Claremont Graduate School. (My Alma Mater!) I was also honored to be named a Senior Fellow for Drucker School. My role is to assist Dean Jenny Darroch and Executive Director, Kathleen Farris build this globally-focused Institute whose mandate is to assist complex multigenerational, global family businesses, based on Peter Drucker’s principals.
The Institute’s next Education Session is on Thursday, August 15, at Drucker School in Claremont, CA at 8am. I’ll be facilitating a panel on, “Working in the Family Business.” The Annual Symposium takes place on Monday, November 11 at the Drucker School; just let me know if you might be interested in attending either event or would like to learn more about the Institute. I am also participating at Cal State University Fullerton, Family Business Center, working with Ed Hart, and facilitating the Women’s CEO Affinity Group monthly. In addition, I am doing some consulting with former Cymric Family Office clients.
I’m thinking this letter could not possibly be complete without an update on the Estate Tax Law! As many will know, there are efforts in the House to roll back the doubling of the lifetime exemption by 3 years, and the amount from $11 million per person to $5 million. We must keep pushing hard to stop this and make the current law, which expires at end of 2025, permanent. We are also working hard to get S176 introduced in the Senate to reduce the rate of gift, estate and GST from 40% to that of the capital gains tax rate. We also want a similar bill introduced by a Ways and Means member in the House. So far, it’s not happening even with support of Ranking Member of Ways and Means, Kevin Brady. While unlikely to get voted on in this session of Congress, it is important to continuously educate legislators on how very important it is to all families to reduce the tax rate and get their support for next session of Congress.
If you are interested in hearing more about this as well as the FEUSA Family Business Survey, I will be speaking on August 6, in Woodlands Hills; The Valley Estate and Business succession planning affinity group of ProVisors, and again on September 17, at Ivy FON in Newport Beach. If you think a group you are involved in would like to hear a presentation, please let me know.
This letter being longer than usual, given the conversations I have had in these recent months, and the new path I am now taking, I felt there was a lot to cover and so I hope you have found it of interest. I always enjoy hearing from you.
With kind regards,
Patricia M. Soldano