How can I ensure my business continues on with the next generation?
Running a business can be all consuming. Small business owners often find themselves fulfilling a wide range of roles, ranging from that of the general manager, accountant, marketing manager, human resources department, therapist, handyman, and much more. With so many jobs to fulfill, it can be easy for a small business owner to put estate planning on the back burner. Without an estate plan in place, however, your death could mean the end of your business as well as financial loss for your family. Our California estate planning lawyers at OC Wills and Trusts present some estate planning essentials for small business owners.
Everyone Needs a Will
A will is critically important for everyone to have. With a will, you can name whom you would like to receive your assets at the time of your death. You can also name a guardian for your minor child and present your wishes for burial. If you die without a will in California, your estate will be passed to your closest living heirs in accordance with state law. You will have no say in who receives what, and your heirs will be left with no guidance as to your wishes.
Most Business Owners Will Benefit From a Trust
In California, most estate valued at over $150,000 will need to go through the probate process. Probate is a time consuming and costly court procedure through which your assets will be distributed to your loved ones. Since most business owners will have assets in excess of $150,000, a trust may become important.
With a trust, your assets owned by the trust will not be subject to probate. These assets, which may include the business, will pass to your beneficiaries in a seamless fashion. This will save your heirs time and money, ensuring a greater share of your hard earned assets go to your intended recipients.
Business Owners Must Plan for the Future of the Business
In addition to a will and a trust, business owners will want to plan for the future of their business with a business succession plan. A business succession plan is a plan for what will become of the business upon your death. You have several options when it comes to business succession planning, including leaving the business to a family member or directing the sale of the business. Your estate planning attorney can assist you in developing an estate plan to protect both your assets and your business. Contact us today.