A business owner pours their heart and soul into their enterprise. Preserving the future of that enterprise according to your wishes in probate, even after you have passed on, is a vital element of business succession in Coral Gables. Many people might be surprised to learn that if the succession of business assets is not properly planned out in advance, the enterprise can be forced to go through probate.
The best way to prevent a business going through probate is to ensure that you have set up a comprehensive estate plan. A local business succession attorney can help you address key issues such as asset protection, business structure, and succession planning while availing all measures that will allow these assets to skip probate in the future.
The process of establishing a succession plan in the event of retirement, illness, incapacitation, or death is key for any business owner. In the absence of a solid business succession plan, essential assets could be at risk of being sold or distributed to creditors during probate.
Probate can become especially complicated if the owner did not establish a plan for how the business would be managed, who would take over the company upon their death, and the roles certain individuals would have within the company. A business succession plan should feature details such as how the sale of the company would proceed, the way the proceeds would be distributed, and who the beneficiaries would be. If a business owner’s asset and debts pass through probate upon their death and these arrangements are not accounted for, Florida law could determine who receives assets and who retains control of the company.
A court that designates a successor to take over the business after the owner’s death may or may not choose the person who is best suited to take on the role. Regardless, the court’s decision is unlikely to align with what the business owner would have wished. Rarely does probate take precedence over the provisions or structure of a business succession strategy.
This makes it vital to work with an attorney who can create an all-encompassing estate and business succession plan that does not interfere with the owner’s wishes for the company. A well-strategized succession plan for a business in Coral Gables can also enable the owner’s family, loved ones, and others involved in company roles to avoid the headaches of probate.
Numerous legal structures could be instrumental in establishing a business succession plan that can bypass or limit probate proceedings in Coral Gables. For example, family limited partnerships can be an effective tool for managing and protecting family-owned businesses, as well as transferring wealth to the next generation. These structures consist of one or more general partners who retain the controlling interest and management of the entity, and one or more limited partners who receive passive income from it but do not have a managing role.
A family limited partnership offers flexible methods of transferring the tax burden between the partners involved. It also enables partners to enjoy ownership and control of the assets contained in the family limited partnership without worrying about creditor claims. This partnership can be altered in the future as circumstances change and can be an effective tool in business succession planning alongside a trust.
A trust for a business can reduce the need for probate. For example, a revocable trust can hold business assets and enable private transfer of ownership that bypasses probate. A revocable trust can be changed at any point during your lifetime. Other legal entities that could prove useful for business owners to outline their succession plan include the formation of corporations, limited liability companies, and buy-and-sell agreements. A Coral Gables attorney can leave no stone unturned to protect someone’s business from probate and keep your loved ones out of court while providing a smooth transition for their business.
When it comes to business succession, it is wise to review your estate plan regularly to ensure nothing has changed regarding the disposition of your assets or beneficiaries. Succession planning is vital to ensure that your business can continue operating if you are incapacitated or pass away, while avoiding the long, stressful, and risky probate process.
A Coral Gables-based attorney can help you establish a plan that safeguards your assets and beneficiaries, establishes a clear-cut business succession plan, and avoids the trappings of probate. Contact Veliz & Associates, P.A. today to receive more information about the next steps.
We evaluate your case and determine how we might be able to help.
We will meet with you to discuss your next options and lay out a plan.
Our team guides you throughout the process so you feel confident about your choices.
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