Business succession planning involves the transfer of management, ownership and control of a business upon the retirement or death of the current leadership. In a family business, this transfer typically moves from one generation to the next. Unfortunately, inadequate planning can result in the failure of a business and cause serious discord among family members. Mona Bentz, Esq. can help you determine the most effective transition method for your business and assemble the appropriate tools to serve both business and family interests.

business succession planning 2Considerations for Business Succession and Wealth Transfer Planning

Wealth transfer planning often goes hand in hand with business succession planning, particularly when a family business is involved. Contrary to what many people believe, family business succession is usually not as simple as a retirement. Whether a family business is a limited partnership (FLP), a limited liability corporation (FLLC), or other business entity, family businesses need a succession plan in order to maximize the benefits of the transfer of wealth.

Additional considerations are:

  • Buy-sell agreements and management succession plans that are important for the smooth continuation of operations of any business.
  • Family businesses also typically need to address the transfer of control while providing an income stream for the older generation. Depending on the circumstances, a freeze or reverse freeze might be appropriate.
  • If future organizational changes are contemplated, other planning opportunities may be available to enhance the generational benefits.
  • For the kids who are not actively involved in business operations, gifting strategies using grantor retained annuity trusts (GRATs), grantor retained unitrusts (GRUTS) and grantor trusts may be appropriate to maximize the gifting opportunities available.
  • Many times the same benefits may be bestowed upon family members while still serving a charitable interest through the use of charitable remainder trusts (CRUTs and CRATs) or charitable lead trusts (CLUTs and CLATs).

The appropriate wealth transfer planning and business succession planning tools or combination of tools for each business vary significantly based upon the dynamics of the business, economic climate, family assets, and needs. It is important to work through potential alternatives carefully to determine what course of action would best serve the family’s interests. Mona Bentz, Esq. can help your family business transfer to the next generation safeguarding your personal and professional legacy. 

“Mona was invaluable in helping us develop a complicated Estate Plan.  In addition to having a “blended” family, our assets are somewhat diverse.  After multiple attempts on our own and meeting with more than one attorney, we were referred to Mona by a trusted friend.  From the initial meeting, it was obvious that Mona was someone who takes a personal interest in her client’s needs.   This compassion, combined with an intrinsic need for getting the details right,  brought about very productive interactions and resulted in an Estate Plan that we understand and are comfortable with.  No question was too small or asked too often and we were involved in the process all the way through.  I highly recommend Mona, not only for her knowledge and expertise, but also for her responsiveness and commitment to getting the job done right.”

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