Strong leadership is necessary for the success and legacy of any business. But “life happens,” and leadership changes are inevitable. Company owners, shareholders, family members, and other key personnel retire, experience a decline in health, and sometimes pass away unexpectedly. Without a business succession plan, these kinds of changes can mean the end of a company.
Business success planning increases the chances for the survival of one’s business upon disability, retirement or death of current owners. Organizations that are prepared with a carefully thought-out succession plan can weather unforeseen events or retirement of the owners while maximizing the company’s value, minimizing tax exposure, and continuing to thrive.
At Pierro, Connor & Strauss, we offer a full range of legal services to business owners. We help our clients understand their business succession planning options and tailor a plan that serves their goals.
First steps in business succession planning
Ideally, business owners have an eye toward succession at the initial stage of business formation. Among other things, their choice of entity impacts an owner’s personal liability for the business’s operations, how many individuals or entities can be owners, how the business and owners are taxed, and how an owner’s estate planning impacts the business.
Whether you are just starting your business or are implementing a business succession plan during operations, an experienced New York business planning attorney will take inventory of your goals and use business and estate planning tools to design a succession plan.
Some factors include:
- Which kinds of your assets are tied up in the business?
- Do you intend to eventually sell the business or keep it in the family?
- If you intend to keep the business in the family, who will run it?
For many family-owned businesses, owners avoid succession planning to delay uncomfortable family conversations and because thinking about an unknown future can simply be unpleasant.
However, proactive planning with the assistance of business succession planning attorneys allows owners to identify points of vulnerability, groom rising talent internally, prepare an alternative exit strategy, and tailor individual estate plans that fit within the interests of business succession.
