Transition Plans Essential for Family Businesses | Law Firm Newswire

Transition Plans Essential for Family Businesses

Hook Law Center (formerly Oast & Hook)

Hook Law Center (formerly Oast & Hook)

Virginia Beach, VA (Law Firm Newswire) October 6, 2014 – Family-owned businesses face one of their most vulnerable periods when transitioning to the next generation after their founder’s retirement or death. More than 70 percent of family businesses do not survive this transition. But a transition plan can help preserve the business for generations to come.

Planning for the transition should encompass both the legal aspects of the process, such as tax and estate planning, and practical discussions with the family members who will take over the business.

“Neglecting to set up a transition plan is one of the biggest mistakes a family business can make,” said Andrew Hook, a Virginia estate planning lawyer with offices in Virginia Beach and Suffolk.

An estate planning attorney can help with the development of a transition plan, especially the legal and tax aspects of the process. The plan will always include a will, and it will most likely include a trust. A well-written estate plan can smooth asset transfers after the business owner’s passing, and it should account for the taxes associated with the process.

It is essential to get the rest of the family involved in planning the transition and running the business well ahead of the founder’s retirement or death. Family members can offer vital insight into the transition, and they should have a chance to learn the ropes in a steady, well-paced setting.

When discussing the transition with the rest of the family, business owners should make sure that everyone involved is on the same page. Discussion should determine who will own the company, who will and will not be involved and what tax strategies will be planned. Those family members who will take over the business will need careful training and support to take over the business with confidence and pride.

Hook Law Center
295 Bendix Road, Suite 170
Virginia Beach, Virginia 23452-1294
Phone: 757-399-7506
Fax: 757-397-1267

5806 Harbour View Blvd.
Suite 203
Suffolk VA 23435
Phone: 757-399-7506
Fax: 757-397-1267

  • Assuming Roles of Trustee and Power of Attorney
    Your loved one has lost capacity and you are named in their Power of Attorney and/or Trust – Now what? If you are fortunate, your loved ones have done their estate planning and put documents in place to enable a trusted person to assume the management of their financial affairs in the event of their […]
  • The Effect of Annuities on Long-Term Care Plans
    Annuities are great investments for people who are frightened by the stock market or need a tax-deferred investment, and they have long been used to ensure a guaranteed income in retirement. In simple terms, an annuity is a contract with an insurance company whereby the purchaser pays a certain amount of money and the insurance […]
  • What Happens to My Online Accounts After I Die?
    In today’s world, many people connect with friends and family via social media more than they do in “real life.” Additionally, online shopping has expanded vastly in the past several years, and most people have several online accounts they use regularly. While the Internet has allowed us to have more connections and to conduct business […]
  • Impeaching Wills
    We often hear from family members who are unhappy with the terms of a loved one’s current Will. The issue is often laced with problematic family dynamics where multiple people claim undue influence or lack of capacity. This intricate web of issues can lead to expensive litigation. As an attorney, the most important factor when […]
  • Is That Really Enough to Retire?
    A recent study by the Associated Press NORC Center for Public Affairs research found that almost 40% of Americans feel confident in their retirement savings. This appears to be a positive statistic given that 10,000 Americans reach 65, traditional retirement age, every day. However, some experts argue that the confidence may be faulty, or, may […]

See other news sources publishing this article. BETA | Tags: , , , , ,

Get headlines from Law Firm Newswire sent right to your inbox.

* indicates required