Estate plans include more than just wills and powers of attorney. While these are important, they may not be enough depending on your assets. When you have a small business, you need more than a will passing it along to your successor. Instead, you need to make a succession plan.
A succession plan not only names a successor but also outlines how the party will take over your business and what, if any, involvement you or the family will retain. Having one in place is beneficial whether you want to move on from your company now or are planning for when you pass away.
How to make a succession plan
First, consider potential successors. Do you want to keep the business in the family? Does your family want to continue the business? Are others interested in acquiring the business? Choose someone who will carry out your wishes, whether that is maintaining your values and practices or revamping the brand and modernizing operations.
Train the person and help employees adjust to the new management, or make arrangements for how this will happen if you pass on. Next, discuss what involvement or investment you or your family will retain, if any, and what your retirement plans will be. Creating a successful exit is likeliest with the help of a Pennsylvania business attorney.
Benefits of a succession plan
Having a strategy for the future of your business not only will help the company continue to thrive, but it also will make the probate process of your estate go more quickly. The more information you include, such as how divorce or death will affect a family-run Pennsylvania business, the smoother everything will go. Finally, establishing the right plan helps you save money in a variety of ways, most notably in taxes. Taxes may be unavoidable no matter what, but they may also be possible to lower with the right preparation.