Four Estate Planning Tips for Florida Business Owners
Small and mid-sized businesses form the backbone of our state’s economy. According to data from the Florida Small Business Development Center (SBDC), there are more than 2 million business owners in the state — a business ownership rate that is 20 percent higher than the national average. Owning and operating a business can be complicated. Proper planning is one of the keys to building and maintaining a successful company.
Business owners should not neglect to address what will happen to their company and their commercial interests within their estate plan. Through comprehensive estate planning, business owners can protect themselves, their family, and their company. In this article, our Tampa estate planning lawyers offer four important estate planning tips for business owners in Florida.
- Start By Drafting a Will
A will (last will and testament) is a foundational estate planning document. Every business owner should have a professionally drafted will in place. Even if you are not planning on using a will to distribute the majority of your assets, it is still important. Among a wide range of other things, you can use your will to appoint an executor for the business while your estate is being settled.
- Create a Business Succession Plan
For business owners, a proper estate plan should include a business succession plan. Essentially, a business succession plan is a set of procedures that will govern what will happen and who will take over day-to-day responsibility for the business should you pass away, become incapacitated, or suddenly retire. A business succession plan should ensure that there is minimal interruption to the company — no matter what unexpected event might occur.
- Consider a Buy-Sell Agreement
Many Florida companies can benefit from putting a buy-sell agreement into place. A buy-sell agreement is a legally binding contract that stipulates what will happen to a partner’s “shares” of the company should they pass away.
If your small or mid-sized business has multiple owners, it is highly recommended that you obtain a buy-sell agreement. When constructed properly, a buy-sell agreement will ease any transition of ownership rights and dramatically reduce the risk of a serious dispute.
- Do Not Ignore Tax Issues
Finally, business owners should not ignore tax issues. While there are considerable exemptions for estate taxes, the transfer of a business could potentially trigger tax liability. In some cases, people are even forced to sell shares in a company in order to pay off taxes. Whenever possible, this should be avoided. An experienced Tampa estate planning attorney can help you create a plan that protects you from avoidable tax liability.
Discuss Your Case With Our Tampa Estate Planning Attorney Today
At Bubley & Bubley, P.A., our Tampa estate planning lawyers have extensive experience representing business owners in Florida. To set up a strictly confidential estate planning consultation, please contact our legal team today. With a law office in Tampa, we serve clients all over Hillsborough County, including in Tempe Terrace, Plant City, Gibsonton, Valrico, and Apollo Beach.