Special Considerations in Estate Planning for Business Owners
Whether you purchased an established business or built your business from the ground up, it’s a big part of your life’s work. You’ve put a lot into it, and you want to ensure that it continues to be part of your legacy long after you’re gone. The Oklahoma City estate planning lawyers at Entz Burton & Associates know that you likely have questions and concerns about how to protect your business and loved ones after your passing—and we’re here to help.
There are many ways to handle a business in your estate planning, but there are also many factors that can affect which options are available to you. We’ll explore different options for passing your business to loved ones, and discuss how your options may vary based on whether you own the business alone or with others.
Ready to find out how your estate plan can address your hopes and dreams for your business? Let’s talk. Our clients choose us for our empathetic and experienced approach to all types of estate planning needs. Call Entz Burton & Associates at 405-773-9800 to set up a consultation.
Business Succession Planning
This is one of the most important parts of estate planning—knowing how, when, and to whom you will pass down your business helps you make the tough decisions ahead of time, rather than leaving these questions to grieving loved ones. As a business owner, you have likely made many sacrifices over the years to keep your business alive and growing. As you decide how you will pass your business down, you have to ask yourself: who will be ready to make those tough decisions? Are your children ready to take on the responsibility of business ownership? What are your plans if you become incapacitated and have no one to take over daily operations?
While these questions can be hard to face, that’s the purpose of estate planning. As we look over your business and think about its future, we’ll be able to guide your decisions with questions like these.
If you co-own a business with other people, it’s important to talk to an estate planning attorney right away. Depending on the agreements you’ve signed, they may have a say in who can take over your share of the business.
Protecting Your Assets
Protecting your business may be at the forefront of your mind during this process. It’s important to take an in-depth, 360-degree look at your business to know exactly what you’re working with. One issue for many small businesses is a lack of liquidity, which may be something we need to address. The business itself may be worth a substantial amount of money, but if that money is tied up in equipment, expansion, and other parts of your business, you may not have the money needed for important tasks. What if, for example, two of your three children do not want to take over ownership of the business? Ideally your business is able to pay them out their share so the remaining child can fully take over without having to pony up their own money.
Another part of this is thinking about how to keep your business from losing value after your passing. People don’t like change, and if employees or stockholders panic when you pass, your business could see a mass exodus of employees and shareholders. An in-depth plan for the handover of your business shows employees, customers, and stockholders that operations will continue to run smoothly—no matter what.
An Effective Transition
To protect the value of your business, you’ll need to support your family in the transition period of your business. We’ve all seen once-successful businesses slowly (or, in some cases, rapidly) die off after the original owner passes on. If you want to save your business from this sad fate, you may want to start the transition before you become incapacitated or pass away. One tool to consider is a family limited partnership, an estate planning tool that can help grow generational wealth and limit the tax issues often associated with transferring assets. By gradually passing the business to your loved ones, you can navigate issues as they arise and slowly step away from daily operations.
Let Our Business Estate Planning Lawyers Help You Explore Business Needs
It’s never too early to begin planning for the future, especially when your business is on the line. Choose the business estate planning attorney’s at Entz Burton & Associates for effective, personalized estate planning solutions that meet your family’s needs. Call us at 405-773-9800 or reach out online to set up a consultation.
Attorney J. Michael Entz at Entz Burton & Associates is an experience lawyer in estate planning law, business formation and asset protection serving the families in Oklahoma City and Weatherford office.