If you’re a business owner doing your estate planning, the odds are that you want to figure out what to do with your business. It may be the biggest asset you have. You must know what to do with it if you pass away or simply if you want to retire.
This can be complicated and only gets more complex with larger businesses. There are a lot of factors to think about, but let’s start with your basic options.
Business succession planning for the next generation
First off, if you want to leave your business to your heirs, you want to create a business succession plan. You don’t really want to leave a company to someone in a will or some other simplistic fashion. You need a direct plan to train them, define what duties and obligations they will have and pick a date at which you will transfer ownership.
Selling the business and dividing the earnings
If you don’t have any heirs who want the business or don’t want to leave it to them, another option is to sell the company to a third party and put the money you obtain into your estate plan. This may make things easier, as you can then put those funds into a trust for your heirs, or you can just divide it up so that everyone gets some of the money in your will.
What is your plan?
The biggest thing to remember is that you need to have some sort of a plan when business ownership and estate planning overlap. Make sure that you know what legal steps to take.