Consulting with an experienced business succession planning attorney is strongly recommended in the event that you have connections to another company. If you want to transfer your business to a successor or if you are getting ready to retire or slow down, it is important to identify the appropriate business succession planning process to make things as easy as possible on your successors as well as to minimize taxes. Most people put this process off because they assume their exit in the business is so far off they don’t need to think about it. However, a sudden event like a disability can happen at any time.
There are several common problems associated with business succession planning. These include:
- Treating children who will not be involved in the business fairly.
- Transferring or selling the business to children without being hit by serious taxes.
- Selling the business to a key employee if that individual has no money.
All these plans should be discussed well in advance with your business succession planning lawyer. Having the intention is one thing, but you also need documents ready to back you up if you decide to move forward with these plans. Legally valid documents can go a long way towards protecting you and helping you craft the transition most valuable to the business and to you.
Consulting with an experienced attorney and identifying potential strategies such as a profit-sharing plan, a qualified personal residence trust or an irrevocable life insurance trust may all be beneficial tactics for identifying a way to pass on the business in a smooth manner. The business can otherwise experience significant interruptions or even face financial jeopardy if the succession plan is not identified by a knowledgeable attorney well in advance. A lawyer can assist you with this process by sitting down and getting to know you and your individual business.