Transferring a business to family members can be both rewarding and stressful for Illinois small business owners. For it to be successful, succession planning is more a process than an event. At Zapolis & Associates, P.C., we often assist business owners in determining who should inherit the business while maintaining family harmony.
According to Kiplinger, identifying a successor is a critical first step in the succession planning process. If you want to leave the business to a family member, talk with him or her about it. Find out if they want the responsibility and have the interest. Some heirs are uninterested while others have committed to another career. For families in which there are several siblings, nephews, nieces and cousins, it may take time to narrow down the best candidate.
The next consideration is training. What skills do they need to ensure they can take the reins confidently? Working with a team of advisors can help prepare the beneficiary for the job of running a company. Some business owners choose to work as consulting basis, collecting a salary and giving their heirs the benefit of their experience.
Choosing one successor from several beneficiaries does not mean that other heirs are left with nothing. Nonvoting shares of stock or a larger share of other assets, such as investment accounts or real estate can help keep the peace while advancing the business. Transferring shares in a trust can offer long-term tax advantages with provisions tailored to your needs. Having an established plan can ensure a smooth transition when you retire or if you die unexpectedly. Visit our webpage for more information on this top.