In June of 2024, the U.S. Supreme Court ruled unanimously on the case Connelly v. United States where life insurance proceeds used to fund a redemption agreement in violation of IRC §2703, were considered in valuing the business. Between this course and the recent Huffman case, avoiding a life insurance-funded redemption agreement tends to be more advisable when §2703 applies. This webinar will discuss issues resulting from that ruling and how to use one or more life insurance LLCs to fund a cross-purchase agreement.

In ES NPA Holding, LLC v. Commissioner, T.C. Memo. 2023-55 approved nontaxable issuance of a profits interest. This webinar will also discuss separate partnership income tax issues of profits interests, basis shifting, and a new possible short window for reporting any basis adjustment.

Finally, this course will discuss the FTC's new prohibition against non-compete agreements, deadlines to meet, and how businesses can protect their intellectual property from defections.

Learning Objectives:

• Evaluate when to use life-insurance-funded agreements and when and how to use cross-purchase agreements


• Identify nontaxable issuance of profits interests to new partnerships and how that differs from shifting among existing partners


• Outline IRS attacks on basis shifting transactions and efforts to place short deadlines on reporting at all levels, including routine, non-abusive basis adjustments


• Evaluate FTC efforts to ban non-compete agreements and how a business can protect its intellectual property that non-competes might otherwise have protected