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This article fulfills a promise I made at a recent seminar (titled “Tax Secrets of the Wealthy”). One of the business owners — also an avid reader of this column — in my audience jokingly asked me, “Irv, do you have a Top 10 List?” I didn’t, but promised to make one and publish it in my tax column. Here goes:

1. Do not keep property (other than a convenience bank account) in joint tenancy. Not with your spouse. Not with anyone else. (This is the most common tax-expensive error we see.)

2. Do not put money in a pension or profit-sharing plan — IRA or other qualified plan — if you are rich or likely to become rich. Rich means you are in the highest income tax brackets (about 40 percent for most states, 35 percent for Florida residents) and highest estate tax bracket (55 percent). Sorry, but qualified plans are double taxed with the tax collector getting up to 73 percent of your plan funds. That’s $730,000 per $1 million. Ouch! (See number 5 below for what to do.)

3. Do not be fooled. A will is not an estate plan. A revocable trust is not an estate plan. They are death documents. Your wealth transfer plan (if you want to legally beat the estate tax) must start now. While you are alive. Simply put, you need a comprehensive lifetime tax plan as part of your overall estate plan.

4. Do not put real estate in a corporation. Not a C corporation. Not an S corporation. Instead, use a family limited partnership or a limited liability company.

5. Do use a “Retirement Plan Rescue” (RPR) if you have over $200,000 in a qualified plan (See 2 above). A RPR has the power to increase your after-tax dollars by a multiple of 10 or more. In a recent case, we used a RPR to increase a client’s after-tax amount in a rollover IRA from $427,000 to over $6 million.

6. Do create an IDT (intentionally defective trust) if you want to make a tax-free transfer of your family-owned business to your kids, yet want to keep absolute legal control of the business for as long as you live. An IDT saves you and the children (to whom you want to transfer the business) an amazing $716,000 in income tax and capital gains tax per $1 million of your business’s value. For example, if your business is worth $2 million, you and your kids will save $1,432,000 ($716,000 X 2). Check it out.

7. Do create a FLIP (family limited partnership) for all of your investment assets not dealt with by the other tax-planning strategies listed here: Typically income producing real estate, vacant land and your stock/bond portfolio.

8. Do make sure, as a final test that all your wealth — every dollar of it, whether you are worth $3 million, or $30 million, or more — passes intact to your family. Just reducing your estate tax is not enough. Always, but always get a second opinion if your current estate plan does not pass the “Final Test” (for example, you are worth $6 million, the entire $6 million to your family; if you are worth $26 million, then $26 million to your family).

9. Do make sure that your advisor uses strategies that protect you and your children from creditors and potential lawsuits (particularly from an ex-spouse when one of your kids gets divorced). Asset protection is just as important as IRS protection.

10. Do make sure you have two separate plans: 1) An estate plan that transfers your wealth in the most tax-effective way; and 2) A lifetime plan that a) maintains your lifestyle (and your spouse’s) for as long as you live and b) Dovetails with your estate plan. Just a word about that lifestyle goal: Maximize your income while making sure your investments are safe. One investment that readers of this column seem to love is life settlements (LS). This investment is offered by a company (that sells on the NASDAQ) and historically has earned an average of 15.83% per year without market risk. Minimum investment is $50,000 for qualified investors.

If you want more information on one or more of the 10 items above, please fax (847-674-5299) your name, area of interest, tax problem or concern, address and all phone numbers (business, home and cell).

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Irv Blackman is a certified public accountant who lives part-time on Marco Island and specializes in estate planning, business succession and asset protection. E-mail him at wealthy@blackmankallick.com or call 417-9732. His Web site is http://www.taxsecretsofthewealthy.com.