Cottage Preservation Strategy
Cottage Preservation Strategy
- Client Profile
- Client owns both a principle residence, and one or more recreation and/or revenue properties.
- Properties have experienced dramatic gains in value over their initial purchase price(s) and/or depreciated values.
- Client would like children to continue to own some or all of these properties.
- Children may not be in a position to pay for the resulting tax liabilities and/or maintenance and upkeep costs associated with the properties, or may not be able to do so on an equitable basis amongst themselves.
- Solution Opportunity
- Calculate and project total tax liability for all properties (other than designated principle residence).
- Calculate and project maintenance and upkeep costs for all properties.
- Purchase permanent life insurance that will cover this amount.
- Depending upon individual situations of the insured and/or beneficiaries, children may pay some or all of the insurance costs to preserve these asset(s).