Most people who begin estate planning imagine their estates as consisting only of their personal property. This often includes bank accounts, real estate, and tangible items. However, it is important to recognize that your estate also includes your business holdings, such as shares of stock, membership in an LLC, or even ownership of a sole proprietorship.
Additionally, having a plan for the future and stability of your business is key. Thankfully, a Huntington Beach business succession planning lawyer could take the lead in drafting a framework that covers the entirety of your business holdings. Our estate planning attorneys could help leave instructions for an inheritance, establish a future for board directors, and arrange for a scheduled retirement.
What Business Assets Should be Incorporated into a Succession Plan?
Business assets can form a substantial part of a person’s estate. Even people not in direct control of a corporation may own significant shares of stock. Other businesspeople might serve as a partner, a member of an LLC, or the owner of a small company. These positions and assets deserve careful protection and identifying the nature of these holdings is one of the first key steps in forming an effective business succession plan.
This can be challenging, but a dedicated attorney in Huntington beach could provide essential support during these early phases of business succession planning. They can work to locate physical shares of stock or determine the true ownership of companies through examining partnership agreements and articles of incorporation. A representative could also examine relevant documents to determine expressed rights to inheritance. In sum, an attorney can assist parties with the groundwork needed to ensure that any business succession plan starts as solid as possible.
Business Succession Plans and Probate
Because an individual’s business assets are part of their estate, they are subject to distribution via the probate process. This means that a court must evaluate a decedent’s testamentary documents and determine which heirs will receive which property. If a decedent lacks a proper business succession plan, the probate process might become significantly more confusing.
For instance, to explain the full destination and extent of one’s assets in testamentary documents means that a court could apply the state’s intestacy laws. Outlined in California Probate Code § 6401 & 6402, these laws determine which parties will inherit a decedent’s assets regardless of the nature of those items. Any confusion with this process could lead to the forced sale of a family business or an important person no longer being a majority shareholder. These outcomes are serious, but a diligent lawyer in Huntington Beach could help craft a business succession plan that prevents a similar scenario.
The Impact of Business Succession Planning on the Immediate Future
While business succession plans can become active upon a person’s death, they may also provide certainty and stability for the coming years. For example, they can transparently outline when a business owner will retire, explain precisely when to sell shares of stock, or elaborate on whether a partner will inherit assets down the line. All of this helps stabilize a company’s future and reduce arguments between parties.
These plans can also protect against catastrophic events. If a shareholder or owner becomes incapacitated due to an accident or illness, these plans can provide instructions to partners about how the company should proceed. A seasoned Huntington Beach attorney understands the impact of catastrophic events on a business and could fight to draft succession plans that reduce risk.
Let a Huntington Beach Business Succession Planning Attorney Take the Lead
Having a comprehensive estate plan means taking a measure of the entirety of your assets, including business arrangements, positions, and holdings. You have the right to dictate what happens to these assets after your death and provide instructions to other parties about proceeding after your retirement.
A Huntington Beach business succession planning lawyer could help you make all the necessary arrangements. An ideal plan can be challenging to draft alone, so do not hesitate to reach out to our office for dedicated legal help.