Small Business Estate Planning 101

 Posted on April 18, 2024 in Estate Planning

When you have worked hard to build up a small business, you probably want that business to become a part of your legacy. There are steps you can take during the estate planning process to give your business the best chances of surviving and thriving long after you are gone. Or, if you know that your business is not likely to survive you for any reason, you can plan for the people you care about most to benefit from the company in another way. Small business owners should be represented by a Kendall County, IL estate planning attorney who is experienced in succession planning for small companies.

Tips for Small Business Owners

Some estate planning tips for small business owners include:

• Consider your successor - Is there someone else who can take over running the business? If you have business partners, consider using a buy-sell agreement so that they can buy out your ownership interest from your chosen beneficiary when you are gone. Or, if you have an adult son or daughter who can take over the business, you may be able to leave him or her your ownership interest directly. 
• Prevent probate - Putting a business through the probate process is no easy task, and doing so can significantly diminish the value of your company. Your attorney will likely recommend using a trust or even transferring ownership during your lifetime. 
• Guard your personal assets from business creditors - Incorporating now is likely the best way to ensure that your personal estate property will not be accessible to business creditors. 
• Plan for valuation - If your plan is to have the company sold to benefit your chosen beneficiaries after your death, you will want to develop a strategy for determining its value. 
• Consider tax implications - You do not want to burden your beneficiaries with tax liabilities when they inherit your ownership interests. Your attorney may recommend using a specific type of trust to reduce potential tax liability. 
• Remember to plan for disability - There is always the possibility that you will not be able to continue running your company right up until your death. It is wise to plan for the possibility that your old age or future incapacity will force you to stop personally running the company during your lifetime. 

Contact a Kendall County, IL Estate Planning Lawyer for Entrepreneurs

Gateville Law Firm is committed to helping small business owner protect their legacies. Experienced Yorkville, IL business succession planning attorney Sean Robertson is skilled in helping business owners plan to keep their companies strong and profitable long after they are gone. Contact us at 630-780-1034 for a complimentary consultation.