Mutual of Omaha Insurance CompanyUnited of Omaha Life Insurance Company

Transferring the Family [Business]

[Presenter Name]

Insurance products and services are offered by Mutual of Omaha Insurance Company or one of its affiliates. Each company is responsible for its own financial and contractual obligations. Exclusions, limitations and reductions may apply. All products may not be available in all states. The information contained herein is not intended to serve as or be a substitute for tax or legal advice.AFN39176_0910

Slide 1

Dilemma

If we want to keep the [Business] in the family, and we are successful at that, can we provide for retirement income? Do we also have an estate planning issue?

If we sell the [Business] when we are ready to retire, that may provide a source of retirement income, but does it jeopardize a future inheritance?

Insurance products and services are offered by Mutual of Omaha Insurance Company or one of its affiliates. Each company is responsible for its own financial and contractual obligations. Exclusions, limitations and reductions may apply. All products may not be available in all states. The information contained herein is not intended to serve as or be a substitute for tax or legal advice.AFN39176_0910

Slide 2

Agenda

•Keeping the [Business]

•Estate Planning Issues

•Selling the [Business]

Slide 3Insurance products and services are offered by Mutual of Omaha Insurance Company or one of its affiliates. Each company is responsible for its own financial and contractual obligations. Exclusions, limitations and reductions may apply. All products may not be available in all states. The information contained herein is not intended to serve as or be a substitute for tax or legal advice.AFN39176_0910

Transferring the Family [Business]

Keeping the [Business]

Slide 4Insurance products and services are offered by Mutual of Omaha Insurance Company or one of its affiliates. Each company is responsible for its own financial and contractual obligations. Exclusions, limitations and reductions may apply. All products may not be available in all states. The information contained herein is not intended to serve as or be a substitute for tax or legal advice.AFN39176_0910

Keeping the [Business]

•Family management and control

•Third party management

•Costs

Slide 5Insurance products and services are offered by Mutual of Omaha Insurance Company or one of its affiliates. Each company is responsible for its own financial and contractual obligations. Exclusions, limitations and reductions may apply. All products may not be available in all states. The information contained herein is not intended to serve as or be a substitute for tax or legal advice.AFN39176_0910

Family Management

• Is there a family member that can step in to assist? to assume control?

•When will they step in?

•Will this affect credit availability?

•Will enough income be generated to support all concerned?

•How do other family members feel about this?

Slide 6Insurance products and services are offered by Mutual of Omaha Insurance Company or one of its affiliates. Each company is responsible for its own financial and contractual obligations. Exclusions, limitations and reductions may apply. All products may not be available in all states. The information contained herein is not intended to serve as or be a substitute for tax or legal advice.AFN39176_0910

Third Party Management

•Is there sufficient income, after expenses, to achieve the desired goals?

Slide 7Insurance products and services are offered by Mutual of Omaha Insurance Company or one of its affiliates. Each company is responsible for its own financial and contractual obligations. Exclusions, limitations and reductions may apply. All products may not be available in all states. The information contained herein is not intended to serve as or be a substitute for tax or legal advice.AFN39176_0910

Transferring the Family [Business]

Estate Planning Issues

Slide 8Insurance products and services are offered by Mutual of Omaha Insurance Company or one of its affiliates. Each company is responsible for its own financial and contractual obligations. Exclusions, limitations and reductions may apply. All products may not be available in all states. The information contained herein is not intended to serve as or be a substitute for tax or legal advice.AFN39176_0910

Estate Planning Issues

•Who will inherit?

•Documents

•Estate equalization

•Estate settlement costs

Slide 9Insurance products and services are offered by Mutual of Omaha Insurance Company or one of its affiliates. Each company is responsible for its own financial and contractual obligations. Exclusions, limitations and reductions may apply. All products may not be available in all states. The information contained herein is not intended to serve as or be a substitute for tax or legal advice.AFN39176_0910

Who Will Inherit?

•Family?

•In-Laws?

•Charity?

•Will Everyone Be Treated Equally?

Slide 10Insurance products and services are offered by Mutual of Omaha Insurance Company or one of its affiliates. Each company is responsible for its own financial and contractual obligations. Exclusions, limitations and reductions may apply. All products may not be available in all states. The information contained herein is not intended to serve as or be a substitute for tax or legal advice.AFN39176_0910

Tools

•Will

•Trust

•Title Arrangement

•Purchase Agreement

Don’t Forget About Gifts

Slide 11Insurance products and services are offered by Mutual of Omaha Insurance Company or one of its affiliates. Each company is responsible for its own financial and contractual obligations. Exclusions, limitations and reductions may apply. All products may not be available in all states. The information contained herein is not intended to serve as or be a substitute for tax or legal advice.AFN39176_0910

Concern

•What if there are those who do not want to stay on the [Business]? How will they be treated?

Slide 12Insurance products and services are offered by Mutual of Omaha Insurance Company or one of its affiliates. Each company is responsible for its own financial and contractual obligations. Exclusions, limitations and reductions may apply. All products may not be available in all states. The information contained herein is not intended to serve as or be a substitute for tax or legal advice.AFN39176_0910

Transferring the Family [Business]

Selling the [Business]

Slide 13Insurance products and services are offered by Mutual of Omaha Insurance Company or one of its affiliates. Each company is responsible for its own financial and contractual obligations. Exclusions, limitations and reductions may apply. All products may not be available in all states. The information contained herein is not intended to serve as or be a substitute for tax or legal advice.AFN39176_0910

Selling the [Business]

•The buy-sell agreement

•Who will buy it?

•When will it be sold?

•Terms of sale

•Sources of funds

•Use of proceeds

•Tax issues

Slide 14Insurance products and services are offered by Mutual of Omaha Insurance Company or one of its affiliates. Each company is responsible for its own financial and contractual obligations. Exclusions, limitations and reductions may apply. All products may not be available in all states. The information contained herein is not intended to serve as or be a substitute for tax or legal advice.AFN39176_0910

The buy-sell agreement

Types of agreements:

•[Business] “buy-out” (Most Common Approach?)

Slide 15Insurance products and services are offered by Mutual of Omaha Insurance Company or one of its affiliates. Each company is responsible for its own financial and contractual obligations. Exclusions, limitations and reductions may apply. All products may not be available in all states. The information contained herein is not intended to serve as or be a substitute for tax or legal advice.AFN39176_0910

Who will buy it?

•Family?

•In-laws?

•Neighbors?

•Competitors?

Slide 16Insurance products and services are offered by Mutual of Omaha Insurance Company or one of its affiliates. Each company is responsible for its own financial and contractual obligations. Exclusions, limitations and reductions may apply. All products may not be available in all states. The information contained herein is not intended to serve as or be a substitute for tax or legal advice.AFN39176_0910

Terms of sale

•Lump sum?

•Pre-arranged financing?

•Installment sale?

Slide 17Insurance products and services are offered by Mutual of Omaha Insurance Company or one of its affiliates. Each company is responsible for its own financial and contractual obligations. Exclusions, limitations and reductions may apply. All products may not be available in all states. The information contained herein is not intended to serve as or be a substitute for tax or legal advice.AFN39176_0910

Source of Funds

•Loan from current owner?

•Bank financing?

•Buyer’s savings/investments?

•Life insurance values/proceeds?

•Combination?

Slide 18Insurance products and services are offered by Mutual of Omaha Insurance Company or one of its affiliates. Each company is responsible for its own financial and contractual obligations. Exclusions, limitations and reductions may apply. All products may not be available in all states. The information contained herein is not intended to serve as or be a substitute for tax or legal advice.AFN39176_0910

Use of Sale Proceeds

•Retirement income

•Debt repayment

•Future Inheritance

Slide 19Insurance products and services are offered by Mutual of Omaha Insurance Company or one of its affiliates. Each company is responsible for its own financial and contractual obligations. Exclusions, limitations and reductions may apply. All products may not be available in all states. The information contained herein is not intended to serve as or be a substitute for tax or legal advice.AFN39176_0910

Estate Settlement Costs

•Debts

•State Inheritance Taxes

•Federal Estate Taxes

•Income Taxes

•Advisor Fees

•Miscellaneous Expenses

Slide 20Insurance products and services are offered by Mutual of Omaha Insurance Company or one of its affiliates. Each company is responsible for its own financial and contractual obligations. Exclusions, limitations and reductions may apply. All products may not be available in all states. The information contained herein is not intended to serve as or be a substitute for tax or legal advice.AFN39176_0910

Estate Settlement Costs

How Will They Be Paid?

•Liquid Assets of the Estate

•Proceeds from the Sale

•Life Insurance Proceeds

Slide 21Insurance products and services are offered by Mutual of Omaha Insurance Company or one of its affiliates. Each company is responsible for its own financial and contractual obligations. Exclusions, limitations and reductions may apply. All products may not be available in all states. The information contained herein is not intended to serve as or be a substitute for tax or legal advice.AFN39176_0910

Question

•How does the sale of the [Business] impact a future inheritance?

Slide 22Insurance products and services are offered by Mutual of Omaha Insurance Company or one of its affiliates. Each company is responsible for its own financial and contractual obligations. Exclusions, limitations and reductions may apply. All products may not be available in all states. The information contained herein is not intended to serve as or be a substitute for tax or legal advice.AFN39176_0910

Transferring the Family [Business]

•The sale may provide retirement income to the former owner(s), but will anything remain for the Heirs?

Slide 23Insurance products and services are offered by Mutual of Omaha Insurance Company or one of its affiliates. Each company is responsible for its own financial and contractual obligations. Exclusions, limitations and reductions may apply. All products may not be available in all states. The information contained herein is not intended to serve as or be a substitute for tax or legal advice.AFN39176_0910

Transferring the Family [Business]

•The sale may provide funds to pay estate settlement costs, but what will remain for the Heirs?

Slide 24Insurance products and services are offered by Mutual of Omaha Insurance Company or one of its affiliates. Each company is responsible for its own financial and contractual obligations. Exclusions, limitations and reductions may apply. All products may not be available in all states. The information contained herein is not intended to serve as or be a substitute for tax or legal advice.AFN39176_0910

Transferring the Family [Business]

Life Insurance might provide an answer:

•Proceeds can help the buyer purchase the [Business].

•Proceeds can be used to provide an inheritance to those not interested in remaining in the [Business].

•Proceeds can be used to pay expenses, allowing the [Business] to pass as intended without a sale.

Slide 25Insurance products and services are offered by Mutual of Omaha Insurance Company or one of its affiliates. Each company is responsible for its own financial and contractual obligations. Exclusions, limitations and reductions may apply. All products may not be available in all states. The information contained herein is not intended to serve as or be a substitute for tax or legal advice.AFN39176_0910

The Key

•Passing the [Business] doesn’t just happen

•There must be a plan

•The plan probably will require funds

•The funding must be structured properly within the plan in order to achieve the goal

Slide 26Insurance products and services are offered by Mutual of Omaha Insurance Company or one of its affiliates. Each company is responsible for its own financial and contractual obligations. Exclusions, limitations and reductions may apply. All products may not be available in all states. The information contained herein is not intended to serve as or be a substitute for tax or legal advice.AFN39176_0910

Transferring the Family [Business]

Questions?

Slide 27Insurance products and services are offered by Mutual of Omaha Insurance Company or one of its affiliates. Each company is responsible for its own financial and contractual obligations. Exclusions, limitations and reductions may apply. All products may not be available in all states. The information contained herein is not intended to serve as or be a substitute for tax or legal advice.AFN39176_0910