Torrance Business Succession Planning Lawyer
Planning ahead for the handoff of your closely-held California company
If you own a closely-held business, you’ve probably invested the majority of your waking hours building it from the ground up. After putting so much of your blood, sweat, and tears into the company you’ve built, you want to feel confident that your heirs will benefit from your hard work, be that as successor owners and operators of the business, or as inheritors of the value of the business after it is sold.
Samuel Ford Law provides reliable business succession planning guidance to the South Bay of Los Angeles
No matter what your goals are for your small business, planning for succession or exit with a seasoned professional is critical. A Torrance business succession planning lawyer at Samuel Ford Law understands how much your business means to you and will work diligently to devise a plan that promotes your goals while minimizing any estate or transfer taxes that could threaten the value of your business. Having studied and lectured on the intricacies of transfer tax law, Samuel Ford is the experienced legal mind you need on your estate planning team when handling the transfer of a small business. Trust Samuel Ford Law to guide your business succession planning process.
What are my options for transitioning out of the leadership of my small business?
If you’re a small business owner who is considering what will become of your company once you retire, there is no one-size-fits-all solution. Each family has different needs and desires, as well as estate tax concerns that may arise depending on your business’ valuation and the state of the law at the time of the transition. Many business owners include either a business succession plan or a business exit plan as a component of their estate planning process.
Business succession plan
A business succession plan provides you and your family with a path forward for keeping your business in the family after you are no longer willing or able to stay on in leadership. Using an attorney’s help to create a business succession plan will allow you to memorialize the timing and circumstances under which you will withdraw from your company. If you wish to remain involved in its direction on an ongoing basis either part-time or as a consultant, a business succession plan can offer clarity on the extent of your role to those who will assume power.
In your business succession plan, you can put in writing the names of those who will assume control of the business, which can prevent acrimony among family members or remaining business partners if there is disagreement over who should take the reins in your absence. The creation of a business succession plan can also help prevent any interruptions in operation that can sometimes result from a handoff in leadership. Business succession plans also offer owners an opportunity to protect their staff from potential negative consequences from a change in ownership.
Business exit plan
For business owners who have decided that they do not wish to keep their business in the family, or who have decided that the sale value of the business would be of greater benefit to their heirs than the value from continuing to operate it, creation of a business exit plan is a more appropriate course of action. A business exit plan allows the owner to step down either through a sale of the business, a winding-down of the business, or a transfer of ownership to the business’ employees through an employee stock ownership plan (ESOP). A business exit plan could also involve the sale of the business to the owner’s children or other family members with the use of an intra-family loan. Again, careful planning is necessary when exiting a business to ensure that a transfer of ownership avoids unnecessary tax burdens.
Business succession planning requires careful consideration of whether heirs are at risk of facing estate tax and generation-skipping transfer taxes
For many small business owners, their business is the largest asset they own. A closely-held business that is passed down to a successive generation can impose a serious estate tax burden if owners have not planned appropriately for a handoff in ownership. In some cases, successive owners are left with no choice but to sell a business in order to pay the exorbitant estate taxes owed due to the transfer in ownership. Whether you’re planning your estate, or simply planning for retirement, business exit or succession planning with a professional is a critical step in protecting the gift you leave for your family.
Contact Samuel Ford Law for Business Succession Estate Planning in Torrance and the South Bay
For trustworthy and experienced professional guidance with a California business succession plan, contact the Torrance offices of business succession planning law firm Samuel Ford Law for a consultation.