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Why do I need business succession planning?

During succession, family businesses often face challenges related to conflicts among family members over leadership and ownership and differing visions for the future of the company. Additionally, a lack of clear communication and documentation regarding the transfer of roles and responsibilities can lead to confusion and discord within the family and the business itself. Because of these factors (and many, many more), most family businesses kick the bucket with their founders.

Business succession planning ensures a smooth transition of ownership and leadership, preserving the hard work you’ve put into building your company. Without a solid succession plan, your business is vulnerable to disputes among family members or stakeholders, legal challenges, and even the risk of shutting down. By proactively preparing for the future, you safeguard the continuity and success of your business, protecting both your legacy and the livelihoods of those who depend on it.

Common reasons for business succession planning:

  • Ensure continuity of business operations
  • Minimize disruption during leadership transitions
  • Preserve family harmony by addressing potential conflicts
  • Protect the interests of stakeholders, including employees and investors
  • Secure the legacy and values of the business
  • Facilitate tax-efficient transfer of ownership
  • Identify and groom successors for leadership roles
  • Prepare for unforeseen events such as disability or death of the owner
  • Maintain competitive advantage and market position

Strategies for business succession planning

Estate planning for the family

Estate planning for the family is crucial, especially in the context of a family business. The family dynamic can determine the success or failure of the business transfer process, particularly in the face of events like retirement, disability, or death of the business owner. Tough questions must be asked and answered to prevent the destruction of a business built over decades.

Considerations include determining who will run the business after you, whether it’s a spouse, child, or key employee, and ensuring financial independence for those not directly involved in the business, such as the spouse. Additionally, arrangements for inheritance and strategies to foster financial responsibility among future generations must be addressed. At Goff Legal, we help families navigate these issues to ensure a smooth transition.

Navigating estate tax uncertainties

With laws and regulations surrounding estate taxes frequently changing, it’s essential to stay informed and proactive to protect your assets. Without proper estate-liquidity planning, your family may have to sell the business just to meet their tax requirements. Our attorneys offer strategic guidance for your unique situation. Whether it’s leveraging tax-saving strategies, establishing trusts, or implementing gifting plans, we work closely with you to develop a comprehensive estate plan.

Coordinating financial and estate plans

Coordinating financial and estate plans ensures that sufficient liquidity is available to address financial obligations such as estate taxes and business debts. Without coordination, your estate plan may fall short of providing the necessary funds to fulfill your goals. By integrating strategies such as life insurance (tailored to the appropriate amount, type, and ownership structure), we ensure your estate plan is adequately funded to meet your people-planning objectives and provide liquidity.

Establishing a business Buy-Sell Agreement (BSA)

A Buy-Sell Agreement (BSA) is a legally binding contract that outlines what happens to an owner’s share of the business in the event of retirement, death, disability, or other triggering events. Without a BSA, the uncertainty surrounding the disposition of an owner’s interest can lead to disputes, disruption of business, and financial strain on the remaining owners. We work closely with you to develop clear guidelines for the smooth transfer of ownership interests.

Schedule your consultation with our attorneys

Goff Legal, PC is committed to helping you sort out your business affairs to ensure a smooth transition of ownership. As a female-owned establishment, we pride ourselves on being more than just a firm—we’re a responsive, client-centered team dedicated to building lasting relationships. You don’t have to settle for unanswered calls or impersonal service — our attorneys are always just a phone call away. Schedule a consultation with our attorneys — we ensure your business outlives you and your successors!

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CONTACT916-625-6556
Contact Us 916-625-6556