Business Succession Planning

There are several factors that can affect the decisions you make and how you handle the succession planning. These include:

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• The type of company.
  Depending on how your company is set up, it could be classified as a corporation (either an S-corp or a C-corp), a limited liability corporation (LLC), or a partnership. Depending on which type of company you have ownership in, succession planning would be handled in a specific way to make sure your needs are met.

• Your role in the company.
  As an owner or part owner, you may be deeply involved in the day-to-day operations of the company. Or, you could just be an investor who owns a share of the company, which you acquired in exchange for start-up money. To make sure the future of the company is guaranteed, succession planning is an important step to take.

• Partnership agreements.
  Let’s say you are a 50 percent partner in your company and both you and your business partner are equally involved in the work that you do. If you should pass away, it’s important to have decided what will happen to your 50 percent of the company. Do you have an heir who works for you and wants to stay involved and retain ownership of your share? Do you want your partner to buy out your share of the company from your estate? Is your business partner in agreement with your planning? These are important issues to resolve in advance.

 

By taking care of your business succession planning, you will make your passing much easier for your family and your business partner or partners, as well as for your employees, customers, and clients. As your attorney, my role will be to make sure that your wishes and the wishes of your family are honored after you pass.