Succession Planning: What It Is, And How We Can Help
If you have a family-owned business, it's never too early to begin succession planning. Although planning for the owner's retirement is a primary consideration, other factors come into play, such as the possibility of unexpected incapacitation. Additionally, family members should be included in the planning to avoid discord that could result.
In fact, family discord, the burden of estate taxes or both are key reasons that about 70 percent of family businesses fail to survive being passed on from the founder to a second generation.
At Bottom Line Tax Services, we draw on our extensive experience with family businesses to help you plan a smooth transition. To begin with, we'll work with you to answer important initial questions:
· Disposition of business — Do you want to keep your business in the family or should you sell it to a third party? We'll discuss the relative merits of each course of action.
· Management — Who will run the business? You may choose to have one family member designated to run it while others share ownership.
· Tax burden — How can you minimize the tax liability? Transferring business ownership typically involves significant tax obligations due upon the transfer. We'll help you assess some complex solutions, such as a corporate reorganization or invoking a trust.
· Family considerations — How do family members feel about the plan? Transferring assets can put a major strain on family relationships. We believe it's important to involve all family members in succession planning early on to avoid hard feelings as much as possible.
Once we've taken the preliminary steps, we'll help you finalize your succession planning in combination with other key elements that come into play. These include determining the business valuation, restructuring that may be advantageous and assessing and minimizing the tax consequences. A major factor, of course, is ensuring that you will be left with sufficient income for a comfortable retirement.
Contact Bottom Line Tax Services for help covering all the bases in succession planning. We have the experience and expertise to make your succession planning a smooth transition and, above all, a success.
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