Owners of closely held businesses and their families can benefit in many ways from a well thought out and implemented estate plan that appropriately addresses the business interests, which often comprise a significant part of a family’s net worth. Most such business owners have a number of uniquely challenging objectives to manage in planning for their demise. The issues vary depending on whether a business owner is the sole owner, has co-business owners, or has (or hopes to have) children in the business. Another key facet is whether there is a strong likelihood that the business will still be owned by the business owner at death, or whether there is a desire for an “exit” before death.
Often a business owner’s top objective, from an estate planning point of view, is to maximize the value of the business interest for the benefit of his or her family. The best way to do this is generally to have business partners or key employees who will be able to carry the business forward in the event of their demise. Because businesses do not run themselves, it is essential to have a plan in place for who can replace the business owner’s role in overseeing the business. That could be one person or a group of people.
