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Estate Planning When You Own a Business—What You Need to Know

You’ve worked hard to build your business where it is today. When making your estate plan, you’ll want to consider some things to ensure your business becomes your legacy. Estate planning for business owners comes with a unique set of concerns you’ll want to address before you pass away. Here are some elements to consider when crafting your estate plan as a business owner.  

Wills

When you pass away, your business is treated like any other property or possession you own, like your home or car. Your business ownership will be handled according to Florida’s intestate laws if you don’t have a will. This usually means the business will go to your surviving spouse or children. If you don’t want someone in the intestate line of succession to inherit your business, you’ll need to state your wishes in a will. When you account for your business in your will, you can specify who you’d like to take over and their responsibilities. You can also make plans for the future of your business so that your partners and employees know your last wishes for your business. 

Buy-Sell Agreements 

If you’re not the sole owner of your business, buy-sell agreements are critical legal contracts all your partners should sign. The primary goal of a buy-sell agreement is to state what will happen to each partner’s stake in the business if they leave, retire, or pass away. Buy-sell agreements also spell out the circumstances and methods other partners can use to purchase your business share. If you don’t have one of these agreements in place, your business shares will likely go to your spouse or your children. 

Succession Planning 

If you plan to transfer ownership of your business to your family, it’s important to create a business succession plan to ensure your heirs can effectively run the company or sell the business in your absence. You should identify your successors and stipulate training and timeframes in your succession plan. This planning is crucial for the continuity and stability of the business and will help prevent disruptions due to sudden leadership changes. 

Living Trust 

A will may not be sufficient to protect your business assets. Instead, a living trust can help keep your business out of probate court. While a will only coordinates the distribution of your assets after you pass away, a living trust is a separate legal entity that can own your share of the business. Business ownership will automatically transfer to your successors after you pass away without going through probate. 

Choose Peppler Law For Your Estate Planning and Business Law Needs 

Our experienced business and estate planning attorney will help you draft a comprehensive estate plan that considers all your assets, including your business. Business owners must consider special considerations when developing an estate plan, which is why you need an estate planning and business lawyer to help you draft your estate plan when you own a business. Contact our Oviedo, Florida, office today to see how we can help you plan for the future of your business. 

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