The American economy typically rewards success and encourages growth, unless you happen to be a family-business owner. Ron’s family has distributed food-service products in Maine for more than 100 years. Because of the estate tax, Ron’s family-owned business may not be around another 100 days. But Dennis Paper & Food Service isn’t the only thing at stake. The livelihoods of their employees and their families also hang in the balance.
Ron’s grandfather—an immigrant—founded the business in 1908. He taught Ron that success in business is about hard work, thrift, creativity, and diligent reinvestment—values Ron still lives by but might not be able to pass down to his children or his company. Today, Dennis Paper & Food Service is the fastest-growing distributor in Maine—a success Ron credits to those values.
Unfortunately, success has made Dennis Paper & Food Service liable for a large estate tax when Ron passes away. Because they are a family-owned business, they have very limited cash reserves and, as a result, the family will likely be forced to sell off substantial assets—if not the entire business to pay the tax. The slow destruction of family-owned business is a national trend affecting thousands of families and their employees.
When Ron passes, his children will be forced to hand over nearly half of his assessed net worth to the government. That is money that could otherwise be used to maintain and grow the business while creating new jobs.