When you own a family business, one critical issue to consider is how you plan to pass your interest and ownership on to surviving members in your estate plan. Depending on the individuals involved and their dynamics, there could potentially be disputes surrounding the transition. As you prepare for the future of your family-owned enterprise, here are some things to consider about California succession planning.
Passing your business interests to family is a complex estate issue, and it would be in your best interests to consult with an experienced California estate planning attorney regarding these matters. Your counsel can help you examine the legal implications of the succession and identify any potential issues. From there, you and your attorney can work on a legal strategy that advances your goal of passing your business to family in the least disruptive manner possible.
Another essential part of succession planning is talking with the family members who will be involved in carrying the business forward. This will provide you and your family with an opportunity to vet issues, develop a management plan, and identify who will be fulfilling important leadership roles within the organization. After your discussions, you may find that the son or daughter you thought wanted to run the operations side, would rather be a silent partner. It may also come to light that an heir has the expectation of assuming a leadership role when others do not see him or her as being qualified. If negative emotions become involved, your loved ones could end up in legal disputes which damage their relationships and the business you worked so hard to build. The more you can do to troubleshoot disagreements now, the less likely there will be problems when the interest is transferred. By having involved conversations, you and the other interested parties can resolve conflicts, clarify goals, and come up with viable solutions to support the business’s future.
With the right planning, you can simplify the transition of your operations, minimize in-fighting, protect business assets, help your family prepare, and set the business on a defined course for the future.
At the Law Offices of Alice A. Salvo, we have experience with California trust and estate planning and can help you develop the right California succession plan for your family business. Schedule a consultation today to explore your options do you can make informed decisions.