Running a business takes everything you’ve got. When you’re juggling day-to-day operations, staffing, marketing, and bookkeeping, it’s easy to push estate planning to the bottom of your to-do list. But without a plan in place, your death or incapacity could bring your business to a halt and leave your loved ones scrambling. We understand how much effort you’ve put into building your company. That’s why we’ll help you take steps now to protect what you’ve built and make sure your business—and your family—aren’t left in a bind later.
Why Estate Planning Is Different for Business Owners
Estate planning is important for everyone, but business owners have even more at stake. You’re not just planning for your personal assets—you’re also protecting your company, employees, and future income stream.
Many small business owners wear multiple hats: manager, accountant, HR, marketing, tech support, and sometimes even janitor. With so much on your plate, it’s understandable that long-term planning takes a backseat. However, the consequences of not having a plan can be serious. Without clear instructions, your business may face interruptions, legal trouble, or closure. A well-thought-out plan keeps your operation running and gives your loved ones a clear path forward.
Key Tools We Use in Business Estate Planning
To create a solid estate plan for your business, we often recommend a combination of tools. These documents and strategies work together to protect your assets, minimize court involvement, and make your wishes clear.
Here are a few that commonly come into play:
- A will – Every business owner should have a valid will. It allows you to name who should inherit your personal property, appoint guardians for your children, and express your wishes for things like funeral arrangements. Without one, California law determines who gets what, and your family is left without guidance.
- A revocable living trust – California requires probate for estates over $184,500, which includes most business owners. A trust allows your assets, including your business, to pass directly to your chosen beneficiaries with no court proceedings required. This saves your family time, stress, and money.
- Buy-sell agreements – If you co-own your business, a buy-sell agreement spells out what happens to your ownership interest if you pass away or become incapacitated. It also prevents disputes among partners or family members.
- Durable powers of attorney – Naming someone to act on your behalf if you’re unable to manage the business ensures someone you trust can step in quickly.
- Life insurance – Policies can fund buyouts, cover ongoing expenses, or provide liquidity for your estate. It’s a useful tool for bridging financial gaps.
These strategies are not one-size-fits-all. We’ll work with you to decide which ones best serve your goals and your company’s structure.
Planning for Succession and Control
A business succession plan is your opportunity to decide who should take over, or what should happen, when you step away. Whether you want to keep the business in the family, sell it, or shut it down in an orderly fashion, the key is to get those wishes in writing.
We’ll guide you through options based on how your business is set up. For example, sole proprietors may have different needs than LLCs or corporations. If you’re hoping to pass the company to a child or relative, we can help structure the transition in a way that avoids conflict and protects the business’s value.
Leaving this step undone can leave your family with hard decisions and potential legal headaches. A clear succession plan offers peace of mind.
Reducing Disputes and Taxes
Without a clear plan, emotions and confusion can easily lead to disputes. That’s especially true when a business is involved. Estate planning creates structure, so there’s less room for miscommunication or disagreement.
We’ll also help you consider how to reduce taxes and expenses that could chip away at your business’s value. Whether it’s through proper asset titling, trusts, or valuation strategies, there are ways to keep more of your hard-earned efforts intact for your beneficiaries.
How We Help You Build a Custom Plan
We take time to understand both your business and your long-term goals. That way, we can create a plan that reflects your wishes and works with your company’s needs. If you already work with a financial planner, CPA, or business attorney, we’ll collaborate with them to make sure your plan covers all the bases. And as things change, we’ll be here to help you adjust.
Secure Your Business and Your Legacy
You’ve worked hard to build your business. Let’s make sure it keeps working for your family, even when you’re no longer at the helm. Contact OC Wills & Trust Attorneys today to create a plan that protects your future and honors your intentions.
