10 wealth management questions every family office should ask now

Wealth management can be unpredictable. We’ve compiled a list of questions and considerations to help family offices be and stay prepared.

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The unpredictable nature of managing wealth can keep family offices on their toes. To help families be proactive, we have compiled a list of questions and considerations covering everything from estate planning to navigating unforeseen tax audit risks. We also recommend that family offices review these considerations throughout the year. 

Estate and Succession Planning

What does the looming specter of the annual lifetime exemption amount mean for you and your family office? It's not just a numerical figure; it's a pivotal determinant of how much of your wealth stays within your family and how much will be taxed. Don’t leave the next generation to navigate this and instead consider these often-overlooked questions that could be the linchpin to securing your legacy:

1. As the deadline for the estate and gift tax exemption rollback approaches at the end of 2025, will estate planning and execution become more expensive? 

2. Have you had open discussions with the next generation around your estate plan, to identify potential pitfalls, disagreements, or misinterpretations ensuring everyone is on board for a seamless transition?

Insurance Oversight

Even the most affluent families can sometimes overlook a critical aspect of retaining wealth: Adequately covering their valuable assets. Regularly review your insurance and know the answers to the following:

3. Have you confirmed that all valuable assets including art collections, jewelry, or cars are appropriately insured under your current policies?

4. Have you reviewed your personal and business liability insurance limits for exposures such as cybersecurity, employment practices, or civil claims?

5. Have you reviewed your financial strategy, including insurance and estate planning, to address changes in your net worth or family structure

Tax and Audit Risk Concerns

When it comes to potential tax and audit risks, you should maintain an adequate paper trail that will stand up to the scrutiny of a tax audit.

6. Beyond the conventional IRS audits, have you thoroughly considered and prepared for potential state tax audits?

7. When making gifts or paying expenses on someone’s behalf, are you documenting every aspect, ensuring that your generosity doesn't inadvertently become a source of audit risk?

Residency and Domicile

It's more than just changing your address; close attention should be paid to understanding areas that could impact your tax obligations. The following questions may help you mitigate risks associated with your choices about relocation. As you contemplate a move, ask the following:

8. Do you understand that there are significant differences between domicile and residency? These terms can have a material impact on your tax status.

9. Timing is everything. Have you thought through the risk of continuing to be taxed in your original state, even after moving? What steps are you taking to ensure this transition is documented and defensible, and how your move might impact how a Trust may be taxed?

Sales Tax and Art Acquisition

In art acquisition, the appreciation of aesthetics is too often accompanied by the less creative but equally important consideration of sales and use tax. Ask yourself:

10. In addition to art, are you conscious of the broader implications of sales and use tax on various assets you may be adding to your estate, and have you developed strategies to mitigate potential sales and use tax?

We understand that for family offices, protecting their most precious asset, the family, is non-negotiable. Asking the right questions now can serve as more than a checklist; it’s a reflection of the commitment you have in securing a legacy that endures.


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Donald Stevens

CPA, Managing Partner - Private Client Services
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Daniel Kesner

CPA, Partner

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Any advice contained in this communication, including attachments and enclosures, is not intended as a thorough, in-depth analysis of specific issues. Nor is it sufficient to avoid tax-related penalties. This has been prepared for information purposes and general guidance only and does not constitute legal or professional advice. You should not act upon the information contained in this publication without obtaining specific professional advice specific to, among other things, your individual facts, circumstances and jurisdiction. No representation or warranty (express or implied) is made as to the accuracy or completeness of the information contained in this publication, and CohnReznick LLP, its partners, employees and agents accept no liability, and disclaim all responsibility, for the consequences of you or anyone else acting, or refraining to act, in reliance on the information contained in this publication or for any decision based on it.