There are quite a few small businesses in Oklahoma. The question is: How many of their owners have a will? According to experts, a succession plan is as critical to operating a business as the business plan is. Family businesses, in particular, can fall apart easily if something happens to the principal. Sound estate planning that includes clear, concise directives regarding the business can prevent additional heartache and loss for survivors.
The co-founder and chief executive of an interior design firm in another state was killed in a bicycle accident on April 9. According to reports, he left his family the greatest gift he could: a well-run business that can continue to prosper without him. The 58-year-old's death was, of course, unexpected. However, because of a thoughtful plan, his wife and family can deal with their emotions and grief without any unmanageable business surprises.
According to a survey noted in The Huffington Post on April 24, 2014, 64 percent of Americans don't have a will for various reasons, including no sense of urgency. Experts suggest, however, that putting a clear succession plan in place is as important as a business plan. A will can specifically identify the roles of each family member as they assume ownership and management of the business. Owner estate planning designed to lessen potential tax burdens and stock transfer delays can prevent business losses.
The longevity of this man's company has allowed for staff and customer loyalty that will support it as they recover from his loss. Settling his estate without business disruption is possible because of sound planning that minimizes tax burdens on heirs, provides for decision-making or dispute resolution and, if needed, hiring of executive or other personnel to fill the void.
Every business owner can benefit from gaining an understanding of what a transition might look like if something happened to him or her, or another principal of the company. A knowledgeable explanation of the liabilities and time frame involved will allow for detailed planning that will protect their dream – something that should top the priority list.
Source: Sun Sentinel, "Brown’s Interiors founder built business to survive" Marcia Heroux Pounds, Apr. 23, 2014