Why Estate Planning Is Crucial For Business Owners

You may know that you need an estate plan for your personal home and assets, but you must also understand that estate planning is crucial for business owners. With a business, you may have other people relying on you and your decisions may affect their future. Estate planning is crucial for business owners; without one, the business may face closure, financial hardship or even court-mandated liquidation. You can avoid all of this by putting an estate plan in place now.

What Business Owners May Want to Include In An Estate Plan

A regular estate plan often includes at least a will, a power of attorney and a healthcare directive. However, as a business owner, you must also consider your company. This means you may need some extra legal documents to ensure the smooth transition of ownership or the sale of your business when you pass away. Several items to consider are:

• Trusts – You can set a trust to designate who inherits the business while potentially minimizing taxes. A trust allows a business to pass seamlessly to your heirs without going through the courts and probate process.
• Succession Planning – This identifies who will take over the business if you become incapacitated or pass away. Having a plan that everyone agrees on can help keep the business running after you’re gone.
• Life Insurance – Your life insurance policy can provide cash for taxes, debts and family living expenses. This means your business can keep running as your loved ones work through their grief of your passing.

Estate planning for your business safeguards your family by giving clear instructions on the distribution of assets. This helps avoid conflicts and can potentially prevent the court probate process. If your business goes through probate, it is subject to personal creditors and other issues that may impact your heirs and beneficiaries. This can cause your business to decline to the point of having to close its doors or cease operations. You’ve worked too hard and put too much into your business to let this happen.

Working With An Estate Planning Attorney

An experienced estate planning attorney understands that owning a business requires a different estate plan than a personal one. Placing your business in a trust can help. Your company will not be subject to the probate process when you pass away. It also allows a smoother transfer of ownership, privacy and maybe even some tax breaks. A trust also protects your company’s assets from personal creditors, allowing your business to continue running even after you are gone.

Other readings:

• Don’t Let Your Small Business Get Caught Up In Probate
• Estate Planning And A Family Business
• Sole Proprietorship And Estate Planning

Talk With an Oak Brook Estate Planning Attorney

As a business owner, it is crucial for you to have an estate plan. An experienced estate and probate lawyer can guide you through the process so you don’t overlook anything. And you can be sure that the trust complies with Illinois laws. To talk to an estate and trust attorney today. Contact the Estate & Probate Legal Group at (630) 864-5835.

AREAS WE SERVE: Cook, DuPage, Kane, Lake and Will counties