Those who are wondering how estate planning is connected to their business succession plan, can get a thorough answer from a business succession lawyer in Folsom, CA from Yee Law Group. If you own a business and your family depends on income from that business, it is important to have a plan in place for when you pass away, that allows that business to function and continue to provide financial security for your family. In fact, a great deal of your estate planning goals should be connected to the transfer or sale of your business.
Family Owned Businesses
Developing a business succession plan is especially critical for family-owned businesses because they may suffer the most monetarily if the head of the business passes or is no longer able to run the business. A lack of a business succession plan is the reason only about thirty percent of family-owned businesses continue to thrive when transferring from one generation to the next. A Folsom business succession lawyer believes that if your business is your most valuable asset, your estate plan can only be successful if your business succession plan has a strong foundation.
A successful business transition plan takes years to implement. A well-thought plan grooms its successors years before it is necessary for them to take the helm. There are several strategies used in creating a viable business succession plan. Our team has experience in business succession and can work with you to implement a reliable plan.
Objective of a Business Succession Plan
If you plan on running the business until you pass, you will need the succession plan as a part of your estate plan to make sure your business continues to run without you. If you do not plan for this in advance and properly prepare your replacement, the executor of your estate may have to take the reins until the right person is fully qualified to do so.
Selling or Transferring the Business to a Family Member
Ideally, a family member has been appointed years in advance and is already heavily involved in managing the company. That relative needs to be aware that you wish to sell the business to them (not just transfer). A CA business succession lawyer in Folsom can see to it that these instructions for selling are listed in your estate plan. There should not be any surprises written in the estate plan or will when it comes to a business succession plan, especially if the family relies on the income from the business for their daily needs.
If you are transferring the business to a family member, the terms also need to be specific in the business succession plan within your estate plan. A Folsom business succession lawyer located in California suggests having family members and the business prepared in advance for the inevitable.
If You Don’t Have a Business Succession Plan
If you die without a business succession plan, the future of your business will depend on how your business is structured. If your business is a corporation or S Corporation, and you were the owner, the business goes to your estate. This could potentially be cause for family disputes as to how and if the business will continue to operate.
Our team can advise you on how to transfer or sell your business as you request and prepare in advance for that to happen. A business succession lawyer in Folsom, CA from Yee Law Group can meet with you for a complimentary consultation to talk more about business succession planning, so please call us today!