Family Business Estate Planning
If you own a business and employ several family members, then you will need to work with an estate planning attorney to ensure the business survives past your passing. The most important factor, beyond who takes over as the CEO, is that everyone who relies on the business for employment can continue to work without any interruptions.
Start by establishing a financial plan for business continuity. Regardless of whether leave the business for retirement or because of your passing, the business will need a plan to avoid the chaos that accompanies the departure of any CEO. If the majority of the business’s financial accounts are held by the owner personally, and not as part of a business account, the business might have to wait until the completion of escrow before any funds can be released.
Frequently, the passing of a family business from one generation to another can be fraught with emotional problems. Some family members might want to leave, others to change positions, and the rest taking sides. A clear, pre-announce plan can reduce those problems. Even if some family members disagree with the plan, at least it won’t be a surprise when the time come for the transition.
If you aren’t sure how you want the business to move forward, your lawyer can put you in touch with a business consultant with a specialization in family businesses. A review of your current business structure along with a continuation plan will save you, your business, and your family time and money when it comes time to see the business pass to the next generation.