If you own a business, there are dozens of important considerations you must make on a daily basis. However, you may not have considered what will happen to your business after you pass. Though estate planning may not be at the top of your to-do list, taking the time to protect your company through this process is crucial. The following blog explores what business owners should take into consideration when planning their estate with the help of Pennsylvania estate planning attorneys.
Why is estate planning important for business owners?
When you own a business, taking the time to plan accordingly is critical to protecting the future of your company. Failure to create an estate plan that includes your business leaves it vulnerable to being mismanaged after your passing. That’s why it’s imperative to take the time to determine how you wish to handle your business once you are no longer in charge.
What should I include in this plan?
One of the most important things you should consider is appointing someone as your financial power of attorney. This gives the individual of your choosing the authority to make financial decisions on your behalf, in the event you become incapacitated or pass away. It’s imperative to choose someone trustworthy who understands your vision for your company and who shares your morals.
Next, you’ll want to consider your succession plan. This is ideal for those who wish to keep the business in the family, as it allows for a seamless transfer of ownership from you to your beneficiaries. This plan should name the inheritor of your company, as well as guidelines to pass information and records to this new owner.
Finally, you may want to consider establishing a living trust. If you own a sole proprietorship, you and your business are considered the same entity. This means any debt incurred by the business reflects on you and vice versa. As such, placing your business assets in a living trust ensures they are protected upon your passing.
Why is consulting an attorney essential?
If you’re a business owner ready to protect the future of your company, ensuring you connect with an experienced attorney is vital. As you can see, there are many considerations you must make, and this process can be overwhelming if you’re unfamiliar with the legal technicalities. Additionally, trying to create an estate plan on your own leaves your business vulnerable to errors that could impact the success and integrity of the company you’ve worked hard to build.
At Friedman Schuman, our team is committed to helping business owners take the necessary steps to shield themselves and their companies from uncertainty. Contact our dedicated firm today to learn how we can help you through this complex process to provide you peace of mind.