QUESTION
Amending a Property Trust after death
Asked on Jul 05th, 2014 on Trusts and Estates - California
More details to this question:
My mother died in 2010, leaving her dance studio business to myself and 2 other siblings. According to the Trust, if both sisters work at the studio they will receive 47.5% profits each, and the remaining 5% goes to my brother. It also states, that if only 1 sister is working at the studio, the 1 working sister will receive 75% of profits, and the remaining 2 siblings will split 25% profits. I want to buy out the majority of my sister's shares, reduce her percentage to 5%, as she will no longer be working at the studio, and I will receive 90% profits. Leaving my brother with his original 5%. Can this change be done? And if so, how? Also, I am in the process of buying another dance studio. Do I have to share the profits with my siblings for that business as well? If so, I do not want to do that, would I need to start a new corporation for the new studio.
1 ANSWER
Taxation Attorney serving Santa Monica, CA
at
Lyster, Inc.
Update Your Profile
The "best" answer" depends, in large measure, on what the trust says and how well you and your siblings get along with each other. If you get along well, it may be possible to modify the trust terms, as necessary, to accomplish your objectives. Alternatively, you might explore the possibilty of forming a business entity (corporation or limited liability company) to purchase the studio. What does the trust say about a sale of the business? The new business entity could provide ownership interests for your two siblings. That is just one possibilty - there are undoubtedly others.
Answered on Jul 06th, 2014 at 3:55 PM