Business Succession Planning: Is Your Business Covered?

A piece of paper saying succession planning with small figures with arrows between them business succession planning

If you are a business owner, business succession planning protects your business, as well as you and your family. Without proper planning, your family and your business can encounter a myriad of legal and financial problems if you can no longer run the business, even temporarily. Longer term, your business may not end up having the future you envision if you don’t have a sound business succession plan in place.

What Is a Business Succession Plan?

Many business owners are so focused on day-to-day operations that they don’t have time to consider the future of the business or plan for what will happen if they cannot run the business due to incapacity or death. A business succession plan addresses those issues.

Every succession plan for a business is unique, because it depends on the nature of the business and the goals of the owner. The plan includes a strategy for who runs the business if the owner becomes incapacitated or passes away, to ensure that leadership and management of the company stay on a firm foundation. It also can provide for transfer or sale of ownership of the business if specific circumstances arise.

Business succession planning is especially important in a family-owned business, to make certain the business stays in the family. The plan may provide specific roles for individual family members, according to their strengths and interests. By designating management roles, the business owner can avoid potential disputes among family members, which can occur if there is not a plan in place for when the owner can no longer operate the business.

A business succession plan also can maximize the value of a business and minimize adverse tax consequences. Accomplishing those goals requires advance planning. Since most business owners cannot anticipate all the potential options and possible strategies for the future of a business on their own, business succession planning is best accomplished by consulting with an attorney who understands all the issues that a succession plan should address.

An owner’s business succession plan must work together with their estate plan, to make certain that goals and plans for the family and the business are consistently implemented. Our business law and estate planning attorneys at Sloan Law Firm have the experience and knowledge to help business owners accomplish their goals through both an estate plan and business succession plan that address a client’s personal and business needs.

How to Develop Your Business Succession Plan

Developing a business succession plan requires addressing a number of critical considerations relating to your family and your business. In deciding what happens if you no longer run the business, your family’s interests and abilities (or lack thereof) are important.

If your family wants to continue to operate the business, your succession plan provides strategies and tools that enable the business to continue without you. If your family is not involved in your business (or does not wish to be), you can provide for transfer or sale of the operations to managers or employees, or someone else outside the business. If you have co-owners, your succession plan must factor in their interests as well.

A business lawyer utilizes a wide range of tools and strategies for continuation or transfer of a business in the event of incapacity or death of the business owner. Your lawyer helps you decide on what approach is best for your business and your personal needs. When you work with an attorney to establish a succession plan for your business, it serves as a safety net that protects your business from unanticipated setbacks in the event of your inability to actively run operations, even temporarily.

To establish a business succession plan, consulting with a lawyer who understands business law and estate planning is essential. Protecting your business is only part of the equation. Your business strategies must also take into account your personal needs and those of your family.

A knowledgeable attorney discusses all the relevant considerations with you, from both business and personal perspectives, before suggesting options that address your goals. Then your lawyer navigates through the entire process with you to determine the strategies that optimize the benefits for you, your family, and your business.

Schedule a Consultation With Our Kansas Business Attorneys

Our business law attorneys at Sloan Law Firm assist clients with development of business succession plans that protect their businesses and families. We ensure that the client’s business plan and estate plan consistently implement their goals.

From our offices in Topeka and Lawrence, we help businesses of all sizes and types throughout the State of Kansas. We invite you to talk with us about business succession planning by contacting us to schedule a consultation.

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