If you have children or family members that work in your business, you may find it logical to choose them as your business successors. This is so you can still provide for them even after the unfortunate event of your passing. With this, you must put in the work to establish a valid business succession plan. Read on to discover the most suitable arrangement to have your business passed to your heirs and how a seasoned Nassau County estate planning lawyer can help you in making this determination.
How do I ensure that my business is passed to my heirs?
Evidently, to ensure that your business is passed to your heirs, you must have a business succession plan in place. This is because if you do not plan accordingly, then you will leave your successors with a heavy burden, conflict, and possibly more. So, to establish a legitimate plan, you must take the following steps:
- Designate an heir: if you only have one child or family member that is already working in your business, then it may be easy to identify them as your heir. However, if you have multiple children or family members involved, it can be more complicated to specify who is to lead.
- Write out clear instructions: that is, you must specify the one child or family member who is to take over your business, and which other children or family members will be compensated.
- Consider opting for a buy-sell agreement: that is, you can give your children or family members who are not necessarily active in your business the opportunity to sell their shares to those who are.
- Consider the future leadership structure: that is, you must not only specify the one child or family member who is to take over your business, but also the rest of the leadership structure moving forward. For example, it should be clear what each person’s day-to-day leadership responsibilities entail.
What are the disadvantages of passing down my business to my heirs?
As insinuated above, working with family can come with heavy conflict. This is why you must truly reflect on whether leaving your business to your heirs is the best decision to make.
For example, when you have passed on, there is the unfortunate possibility that a power struggle may arise between your heirs. Or, your designated heir may not be business savvy and may decide to sell your business or cause your business to decline. Under these circumstances, you might want to sell your business to a co-owner, key employee, or outside buyer.
For further assistance, retain the services of one of the competent lawyers at our law firm today.
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If you need a Nassau County lawyer who has significant experience handling family and estate planning matters, contact Barrows Levy PLLC to schedule a consultation with one of our experienced attorneys today.
