8. What if my biggest asset is the company that I own?
It is not unusual for Clients to defer decisions about their business interests, or at least defer formalizing such plans. In addition to determining who eventually will inherit or buy into ownership of the business assets, there are important questions regarding the business management, whether any assets should be sold, gifted or restructured, and a review of the pension plans and insurance coverage and their adequacy in a transition period. The Client may also want to consider giving or selling minority shares during the owner’s lifetime, or establishing other benefits for family members who will not be participating actively in the business. There may be key employees to be rewarded or given incentives to remain. The answers to these questions will significantly affect the rest of the estate planning, and business assets should be specifically addressed to avoid confusion and misunderstandings and preserve the value of the business and related assets.
In my experience, this area deserves some real time and attention, not waiting until there is an emergency and the business owner cannot control the process. It may be helpful if the Client consults with his trusted advisors to develop and review options, with the tax impact and other financial data the owner will need for decision-making. The estate-planning lawyer, business lawyer, accountant, financial planner, insurance agent, retirement planner, and perhaps an investment banker familiar with the Client’s business, might have useful information to offer in this process, along with the family members’ input, in the Client’s ultimate decision.