Littman Krooks Estate Planning Attorneys Suggest Preparing For The Best Business Legacy
White Plains, NY (Law Firm Newswire) September 6, 2013 - A family-owned business is a hard-won commodity and considered a legacy to be passed on to the next generation.
However, that legacy can be lost in the transition from one generation to the next; more than 70 percent of family-owned businesses do not successfully survive the transfer. Estate planning specialists say that business owners may wish to develop a transition plan with an estate planning attorney to ensure the business makes it to their children intact upon their retirement or death.
How can business owners ensure their plans for the future are successful? They should work with an estate planning attorney to develop a living trust or will. They should speak with all involved family members about their intentions for the business and establish a business succession plan in order to transfer the control and ownership, including any in-laws and additional non-blood relatives, if they are involved with aspects of the business or can offer a different perspective.
The business succession plan may include detailed plans in order to preserve and enhance what is commonly known as the “institutional memory” so that any branding or legacy reputation stays intact. Also noted should be who actually owns the business, what advisers are on board to help with the ownership transition, who is in charge of the day-to-day business activities, what provisions have been put into place for the heirs not actively involved in the business, and what training or educational steps should be taken by newly involved family members and key employees.
Other things to discuss with an estate planning attorney: plans to ensure that the business has access to a significant cash flow in order to pay estate taxes or purchase the shares of the company held by the deceased; compensation, supervision and training for employed family members; and an established buy-sell agreement in place for the possible future sale of company shares or partnerships.
While retaining control over a hard-built business is attractive, even in later years, the best thing someone can do to truly ensure that one's legacy and investment continues is to put solid estate plans into place.
New York Contact:
Maria M. Brill
Littman Krooks LLP
New York City Office
655 Third Avenue, 20th Floor
New York, New York 10017
(212) 490-2020 Phone
399 Knollwood Road
White Plains, New York 10603
(914) 684-2100 Phone
300 Westage Business Center Drive, Suite 400
Fishkill, NY 12524
(845) 896-1106 Phone
- Settlement Reached for Seniors Who Must Leave Assisted Living Home
An assisted living home for seniors in New York City is closing and five residents who had refused to move will accept a $3.35 million settlement. In March 2014, the management of a home for seniors in Brooklyn announced that the facility was closing and the residents would have to move within 90 days. Many […]
- Medicaid Asset Transfers: What Are The Rules?
For many families, paying for a loved one’s extended stay in a nursing home would be difficult without the help of Medicaid. However, in order to qualify for the program, a person’s income and assets must fall within certain limits. Federal rules state that to qualify for Medicaid nursing home coverage, a person must have […]
- Seniors & Mental Health: Is it Mental Illness or Aging?
Seniors are more at risk for mental illness than the general population. According to the Centers for Disease Control and Prevention (CDC), about 20 percent of people age 55 and older experience some kind of mental health concern. Not only are more seniors affected by mental illness, nearly one in three affected older adults does […]