The statistics on trusts and wills are frequently discussed. There are numerous reports that point to the fact that many people do not care about drafting the will. Life insurance is a different aspect of the planning for end-of-life which is often overlooked.
In general, it’s not until people age or have dependents that the end-of-life planning becomes more important.
Although it does require a certain amount of pragmatism, planning your estate is vital to ensure your loved ones are cared for in the event of your death.
For business owners there might be a greater amount of importance attached to the final-of-life plans.
The fact that you have a last testamentary will isn’t enough. A thorough estate plan is essential if you’re a business owner.
What Exactly Is Estate Planning, And What Is Involved?
The lawyers of Two Spruce Law P.C. situated in Bend Oregon were asked to describe the process of estate planning and what it entails.
There are many areas and aspects of Estate planning and planning. Legal help is often required. Particularly in cases where assets with complex structures are involved
Other elements of estate planning include custodians and proxies. The planning for healthcare is a possibility as well.
Estate planning can include healthcare directives that permit you to express your wishes about medical treatment in the event of your becoming incapacitated.
Estate planning is a method of arranging your financial affairs and establish guidelines to distribute assets. It’s a simple process to ensure that your wishes are met when you die.
If you don’t have estate plans, you’ll not have any control over how your assets go, or the way your legacy will be distributed.
The estate planning process allows charitable trusts to be created too. You could wish to have your estate to go certain charitable organizations upon your passing away.
Wills And Trusts Are A Basic Part Of Estate Planning
Writing a will is a good way to ensure that your possessions and assets pass to your beneficiaries of choice. This will allow you to support your dependents after your death.
A will permits the appointment of guardians, and even funeral plans. Trusts are different.
By establishing a trust, you can appoint a trusted person to oversee your assets in case you become incapacitated due to illness or pass away.
And then there’s your business to take into consideration. You’ll need an valuation of assets for your business to assess the worth of your business. After that, plans for business succession should be in place.
This is not the only way estate planning can benefit business owners.
Why Should Business Owners Be Concerned About Estate Planning?
Most people just need to make a basic will. Simple estates with no financial issues are simple to divide and transfer to loved family members. But, business owners have more complex estates.
Take a look at your business. Are you the sole owner of it or do you share ownership with an investor? What are the debts that you have to pay for the company? What are the best ways to protect the business in case you die or are disabled?
Estate planning is required by business owners to assure a smooth transition and continued operations when the chief executive of the business is gone. However, sometimes death results in disputes, legal battles and tax issues.
Estate planning for business succession allows owners to define the clear path for transfer to the successors they choose. Estate planning lawyers are able to draft plans that eliminate the need for confusion or ambiguity.
A solid business succession plan can remove any obstacles and allow a business to carry on as usual. There are also benefits for business owners, as you will see below.
1. Asset Protection
When you die It is possible that someone else will come through the bushes to claim the assets of your business.
Legal protection of assets needs estate planning lawyers to ensure that the value of a business’s assets are secured.
There are, of course, ways to hide assets, and conceal these from IRS and other creditors.
However, this shady practice can only hurt your business over the long-term. Estate planning lawyers protect assets legally and defend them from creditors.
2. Protection From Taxes
There aren’t many things that can be guaranteed in the world today. However, as the well-known quote says, taxes are just among them. In the event that assets pass to people who will benefit some taxes might be imposed.
Tax on gifts and estates are likely to be a factor. With a smart estate plan an approach can be implemented to minimize tax burden.
3. Dependent’s Financial Security
A significant aspect of estate planning is choosing which assets to pass on to whom.
Wills and trusts enable individuals to give financial protection to their spouses and dependents. The same is relevant for entrepreneurs as well as individuals.
To ensure your desires are fulfilled concerning the distribution of your company’s assets Estate planning should be utilized. So you’ll be able to rest assured that your family members will be able to receive their inheritance.
4. Protection For The Key Employees
The insurance industry has policies that can be purchased to protect the crucial employees who businesses cannot do with.
Executives, top salespeople and everyone else who plays a vital role in the growth of a business must be secured.
Estate planning allows you to make arrangements to protect and compensate employees.
5. Contingency Planning
The majority of estate planning in business involves contingency planning. The putting in place of buy-sell agreements that protect important employees or business partners is only one instance.
If you die, your business may collapse if there isn’t an emergency plan.
The creation of an estate plan is a way to make provisions for the unexpected events life will provide.
People die unexpectedly. Accidents can happen. and serious illness can strike without warning.
Plans for contingencies are a part and integral to creating an enterprise for success. It is the same in helping businesses continue even after the business’s owner or persona dies.
Implementing contingency plans ensures that powers of attorney are created before anything happens.
People you trust may be appointed to oversee the business’s areas and also assist in business continuity.
6. Personal And Business Asset Goals
The owners of businesses are also able to have personal assets. This is a reason estate planning is more complicated for entrepreneurs than for normal people.
Anyone can draft will without the help of lawyers. In fact, there are online sites that allow legal wills and divorce papers can be downloaded. However the estate plan for entrepreneurs needs skilled legal assistance.
Legal counsel for estate planning can help the owners of companies evaluate their goals for business and personal to distribute assets.
How assets are transferred will be laid out clearly in your instructions. This way, your wishes will be fulfilled regardless of the asset’s ownership to you or your company.
Summary
Estate planning is a way to keep conflict out of the way following the death of a person. A well-drafted will prevent probate and more stress for grieving loved ones.
If you are a business owner, estate planning is essential to select successors and protect the company’s assets.
In the case of complex financial issues death wishes must be clearly laid out. Instructions and directives should not be vague or confusing.
Thus, estate planning lawyers are essential for business owners in order to reduce tax burdens and safeguard the assets against creditors.
