For small business owners, day-to-day operations may overshadow concerns about business structure and succession planning. In order to get your ducks in a row as a business owner, however, you should think about how your business is set up, and what happens to it, if something happens to you.
This applies even if you run a very small business, with no employees, and you report the business income on your regular income tax return.
Maybe you will just shut your doors when you retire. Still, it is wise to leave a plan that allows your family or trustees to deal with any loose ends – tax issues, bank accounts owned by the business, or outstanding contracts.
If your business is a corporation, a partnership, or an LLC, you may think you have it organized. However, reviewing the documents with your estate planning lawyer may reveal some planning holes that can be plugged.
For a solo proprietorship with no corporate or partnership structure, we can add provisions to your revocable trust, allowing your trustee to deal with any business issues that come up. A complete power of attorney can also specify that someone can deal with business matters for you if you are unable to.
If your business is structured as a corporation, we can help you arrange for your trust to own the stock, and we may recommend that you name officers to handle things, to speed up transition. We can help to make sure your company is in good standing that you have appropriate officers and that the registered agent is appropriate.
If your business is structured as an LLC, we can help you to make sure that your operating agreement provides for transition. It may be advisable for your Life Trust to be a member of the LLC.
Your Life Trust can also be a member of a limited or general partnership. However, if you are a member of a partnership, and your Life Trust cannot be a member for some reason, we can review the partnership documents and ensure that your estate plan will coordinate with them.
The first step to getting your ducks in a row is a consultation appointment. Call us today and arrange a consultation meeting. Meetings are available over Zoom.