Most financial advisors will advise you not to design your entire estate plan on avoiding or reducing taxes; however, the following are possible changes under a Biden presidency, which you may want to take into consideration:
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As we often value businesses’ common stock for Section 409A purposes, we frequently are asked, “Why is there a difference between a company’s post-money value (based on a recent round of financing) and the company’s fair market value?” A post-money value calculation simply multiplies the per-share issue price of the most recently-issued security by the total number of shares outstanding. For this total to be equal to fair market value, the value of every security would have to be equivalent, i.e., the common shares would have to have the same value as the most senior of the preferred securities. In almost all situations, this is very unlikely. The preferred securities will (almost always) be more valuable because they have liquidity preferences and may or may not have other rights and privileges, such as anti-dilution and participation rights, to name a couple.
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