Steps Involved When Drafting a Business Succession Plan

Thinking about the growth and financial stability of a business is a good thing for entrepreneurs to do. A business cannot grow without maximum focus and commitment. However, it is good for the same entrepreneurs to think about what would happen if they were never capable of running the business due to chronic illnesses, terminal diseases, permanent disability, major accident injuries or even death. Business owners without an estate plan endanger the well-being of those they love, jeopardize associates’ livelihood and undermine a lifetime hard work. To avoid estate problems that usually occur, it’s good to let a competent estate planning lawyer help make a succession plan. Here is how you come up with one:

Estate Planning LawyerWriting a will

Most people consider a will as the last basic document used during estate planning. This document shows how the business or estate owners wish their assets distributed. The will also shows what should be transferred to whom. In normal circumstances, the will creator or testator is allowed to name an executor or a personal representative who would manage and disburse the business and personal assets as the testator wished. If you choose to document your will in a probate court, it is good to do it under the guidance of an experienced estate planning lawyer.

A trust

A will is a public document that is in most times probated in court. However, it may not be effective for small business people who want to protect their sensitive business information. In addition, the delays and cost that come with probate can greatly hinder the continuity of the business. To avoid this, it is important to let a qualified NY estate planning lawyer help you get a revocable living trust. The trust allows the trustee or the trust creator to continue managing their property when alive.

Power of attorney

Having a general and durable power of attorney is a crucial thing that every estate owner should think about. It states that someone is mandated to handle or manage the business affairs in case the estate or business owner becomes incapacitated. Some family members, partners, or other business owners are mandated to access financial accounts, make payrolls, pay creditors and vendors and manage the business assets. According to competent estate lawyers from any reputable estate planning law firm, the court may appoint a guardian to oversee the business affairs if the living trust is not documented.

Sell-buy agreement

Buy-sell agreements are important for businesses with fewer owners or for partnerships. The document establishes a reliable method of redistributing the interest of the owner in case of disability or death. The buy-sell agreement is also important if the business owner has filed a divorce case or has declared bankruptcy. Some of the buy-sell agreements you would come across during commercial litigation New York has today include stock-redemption and cross-purchase agreements.

Although everyone finds estate plan important, entrepreneurs should be the first ones to embrace estate planning. Without an estate plan, the business may not continue operating since the remaining relatives, owners and partners would be busy scrambling on who should manage the business assets. If you don’t contact an estate planning lawyer in good time, serious disputes would definitely arise later. See more at http://www.noglaw.com/estate-and-trust-planning/

Post Author: Jasmine Collier

Jasmine Collier