fbpx

Selling Your Business? You Need a Plan!

Selling the businessBusiness and asset owners (including farming operations), at some point in their career lives, must ask the eternal question, “What happens when I’m gone?” Answering this question is critical to understanding and planning for the disposition of assets both before and after death. Two things are discussed often. One is estate planning, and the other is businesses transition. Many times these two processes are thought to be the same. Actually, they are very different.

The Columbus (NE) Telegram’s article, “Estate planning and business transition quite different,” reminds us that estate planning involves the transfer of wealth and assets of an individual (personal and business-related) from one individual to another or an entity.

Remember that estate planning doesn’t have to pass assets to an individual. A business asset (tangible and intangible) and ownership can also be transferred to a legal entity, such as a corporation, limited liability company, or a trust. And this can happened whenever the owner decides.

Business transition is simply the transfer of a business asset or the entire entity from an existing owner who has decided to retire or move on. This usually occurs during the life of the existing owner. However, when a business transfer takes place after the death of the owner, it’s usually part of an existing or implied estate plan or asset transfer process.

The process of business transfer can be a very simple process, or it can be complex and dynamic with many steps, based upon the wishes of the existing owner. There is a valuation of the business and the resources that must take place. The transfer of the tangible and intangible assets can occur through the cash purchase of individual items, a purchase of share interest, and/or purchase of stock or certificates. A cash sale, just like when buying a house, is the quickest and cleanest. A larger company with stockholders and a corporate structure takes some time.

The article reminds us that there are a number of similarities between estate plans and transition plans, but the big difference is timing of the transfer. Estate plans deal with the transfer of tangible and intangible assets and interests after the owner has died. A business transfer plan typically happens when the owner is still alive.

Neither of these is designed to be a replacement for the other. They work together, to fulfill the wishes of the business owner. A qualified estate planning attorney can help a business owner sort out the issues and create both plans according to the owner’s wishes.

You can learn more about this topic as well as other strategies on our website under the tab entitled: business planning in Virginia. Be sure you also sign up for our complimentary e-newsletter so that you may be informed of all the latest issues that could affect you, your loved ones and your estate planning.  However, proper estate planning is not a do-it-yourself project.  Why not call us for a complimentary consultation at 757-259-0707.

Reference: Columbus (NE) Telegram (July 20, 2015) “Estate planning and business transition quite different”

Like this article?

Share on facebook
Share on Facebook
Share on twitter
Share on Twitter
Share on linkedin
Share on Linkdin
Share on pinterest
Share on Pinterest

Leave a comment

LIKE THIS POST?

We have a LOT more where that came from!

We hate spam too. We will never share or sell your information.

Call Now ButtonCall Us Now https://jsfiddle.net/7h5246b8/

Request a free consultation

We hate spam too. We will never share or sell your information.

We've been putting together as many resources as possible so that we can continue to help:

  • If you’re a current client with a signing appointment or a prospective client with a consultation and would prefer that meeting take place in your own home, we can accomplish that with a little bit of pre-planning on our part and with the addition of a laptop, smartphone, tablet or other computer in your home to facilitate this virtual meeting. For those of you that need to sign legal documents, that too can be accomplished with the use of a webcam (FaceTime etc.), so that we can witness and electronically notarize all of your important legal documents.
  • We launched the rollout of our on-demand webinar early so that new clients and our allied professionals can view the important component parts of ‘an estate plan that works’ at their convenience.  That is available on our website.
  • Live video workshops will be produced as quickly as possible and certainly ahead of our previous schedule; we will keep you posted as these events become available. Given the ‘boutique’ nature of the firm, we rarely have more than ten people in our office including team members at any one time. During this period of ‘social distancing,’ we promise to have no more than 8 people at any time.   This allows us to comply with the Governor’s directive to limit in-person gatherings.
  • The best way to communicate with us is still by phone during regular office hours of 8:30 to 5:00, Monday through Friday, or, you can email any of our team members (that is, their first name followed by @zarembalaw.com).  We will respond to these emails as quickly as possible.
  • Please continue to follow the directives of our local, state, and federal agencies. For your health and in consideration of our team who is assisting you, if you’ve scheduled an office appointment or planned to drop off paperwork and are experiencing a fever, dry cough, or shortness of breath, please contact your primary care doctor for guidance and then our office to reschedule.

Thank you, Walt and the Zaremba Team

Coronavirus/Covid-19
Update to our Process

The unprecedented coronavirus pandemic has taken our entire country by surprise. We understand how difficult this time is for America’s businesses and families.  However, we believe it is vitally important that we make every effort possible to continue to offer solutions that avoid disrupting our important partnership with you, your family and friends.  As you know, estate planning is not something that should wait for a more convenient time, therefore the opportunity to address your important goals both during and after this crisis should not wait.  To that end, we have added the option of a ‘virtual consultation’ to our office process.  You will now have a choice of either meeting with us in our office or in the comfort of your own home.