Business Owner Strategies
Family owned businesses – even successful ones – don’t often survive into future generations. Two obvious reasons for this are family conflict and federal estate taxes. But a third reason is perhaps even more influential: failure to design a proper succession plan.
Business owners are typically so busy with day-to- day challenges that they often have little time to think about who will take over the business once they’re gone. But the consequences of having no plan in place could be catastrophic to the family, employees and others who depend upon the business.
At its most basic, a business succession plan is a documented road map for your partners, heirs and successors to follow in the event of your death, disability or retirement. It can also be used to orchestrate the sale of your business and may even help establish the value of your business. It may also help:
- Establish who would run the business if you retire or pass away
- Set policies for distribution of business stock and other assets
- Set schedules for debt retirement
- Encourage key employee retention
- Protect the business should a partner decide to take his share and leave
- Prevent family conflict from forcing the sale of the business
- Pay estate taxes without sacrificing the business
- Provide a way to take advantage of unexpected expansion opportunities
Lincoln Financial Advisors Corp. and its representatives do not provide legal or tax advice. You may want to consult a legal or tax advisor regarding any legal or tax information as it relates to your personal circumstances.