Estate Planning For Small Business Owners – Guides

If you are the owner of a small business, have you ever planned what will happen to your company if something happens to you? Probably not, because it is not in your plans that something bad takes effect. However, in the case of incapacitation or death, you must protect your company.

In this guide, we will share why estate planning for small business owners is vital, and how we can help you accomplish your state planning goals.

The Importance of Estate Planning for Small Business Owners

Small business owners carry a great responsibility on their shoulders. They must foresee all kinds of situations, including putting them in the event that they become incapacitated or even die.

For this, it is important that they have analyzed and planned what will happen to their business and how it will continue operating.

Since your business may be your largest individual asset, it should be integrated into your estate plan. This action is of vital importance because:

1. It secures that despite your incapacity or death, your business can continue to operate, manage, or even be able to be transferred.
2. It reduces estate transfer taxes.

It Helps to Ensure the Continuation of Your Business

Imagine that you are in a condition which you will not be able to run your business. In addition to not being able to sign checks, or handle payroll on a regular basis, have you ever wondered who will take care of all this in your place? Have you overseen making planning about the person that you will give the legal power to take over your business?

The worst that can happen is dying suddenly while still being the owner. If your company has value, it will be very difficult for it to continue operating. Not only that, but also that it is transferred to another person, or that even your family can make a profit after selling it.

That is why you must make a plan so that you can express what you want in case something unfortunate happens. In this way, your wishes will be fulfilled under a legal framework.

It Helps to Save on Estate Transfer Taxes

Studies show that 70% of small or family businesses have not survived over the years after the death of the owner. It is indicated that a relevant reason for this is the IRS and the devastating effect that estate taxes have on the future of the company.

The estate tax rate is very high, reaching 40% of the value of the estate. In addition, it must be paid 9 months after the death of the business owner.

Certainly, it is almost impossible for companies to generate this large sum of money in such a short time. Small companies fight day by day to grow and win in today’s highly competitive world.

That is why, to avoid paying these exorbitant sums of estate transfer tax money, do some planning. It will not only benefit you but also the members of your family. In this way, your company can continue operating or be transferred.

How Can an Attorney Help You with Estate Planning for Small Businesses?

An attorney can help you map out the best estate planning strategies for you to achieve your goals. We present you a list of some planning tools:

• Powers of attorney.Used to grant a person the authority to run your business.
• Partnership agreements.They define what will be done in the event a partner dies or retires.
• A buy/sell agreement.Allow the shareholders of the business to take control of the business in your absence.
• Allow your beneficiaries to receive the interests of your business in case you die.

A skillful estate planning attorney will teach you how to use these mechanisms to guarantee that your business will continue operating and that estate transfer taxes will be reduced. Furthermore, he/she will help you incorporate these tools into your overall plan.

Receive Special Help for Estate Planning for Small Business Owners Now

Are you looking for a legal service specialized in real estate for small business owners? We are here for you. Call us to (305) 921-0440 or send us an email to [email protected] and we will help you to handle the state planning for your small business.