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Who Needs Business Succession Planning in Their Estate Plan? | MD
Business succession planning is the process of preparing for the future of a business when the owner or key leaders leave, retire, or pass away. It involves creating a plan to ensure that the business continues to operate smoothly and successfully. Many people who own businesses want to make sure that they have a business succession plan in place as part of their overall estate plan. This is especially true for families businesses and small business owners.
A business succession plan might include choosing and training a successor, setting up financial arrangements, and setting guidelines for how decisions will be made in the future. Succession planning is important for businesses of all sizes because it helps protect the business from uncertainty and disruption and allows the name, reputation, and financial worth of the business to be passed forward according to a business owner's wishes. If you own a business in Maryland, consider contacting a Maryland estate planning attorney to help guide you through the succession planning process.
4 Tips for High Net Worth Estate Planning
Estate planning ensures that individuals with significant wealth can protect and distribute their assets according to their wishes, while also minimizing tax implications and potential legal challenges. As a high net worth individual, your estate planning needs are often more complex and require careful consideration. A Maryland estate planning lawyer can help you navigate the common difficulties of high net worth estate planning to make sure you get the most out of your situation.
Understand the Importance of Comprehensive Planning
When it comes to estate planning for high net worth individuals, a simple will often falls short. The challenges of substantial assets calls for a more nuanced, holistic approach. You should carefully craft your estate plan to address various aspects of your financial and personal life. This includes protecting your assets from potential risks, optimizing tax strategies to preserve wealth, and outlining your philanthropic goals.
Navigating through probate
Whether the loss of a loved one is the end of a long struggle with illness or the result of a sudden accident, many families face new challenges getting through the probate process. Especially if it’s the first time working through the proceedings, it can be daunting to get through the process without an experienced attorney.
1. Probate lawyers already know the process
Probate is a process with many necessary steps, a real challenge to navigate without experience. Having a probate lawyer act as a guide can help the executor/personal representative meet all requirements and keep the process moving. The lawyer can facilitate meeting essential deadlines, filing forms, arranging for the executor/personal representative to be bonded, obtaining tax identification numbers, hiring appraisers, realtors and tax professionals, and handling creditors. When these steps are done correctly right from the start, time consuming, costly and stressful supplemental filings, audits and other extra work generally can be avoided.
5 questions to ask when choosing a guardian
When you bring your newborn home from the hospital, you plan to spend the next 18 years and beyond providing and caring for your child. But if you aren’t around, you want to make sure that the right person can take over parenting duties. If you haven’t done so yet, you may wish to name one or more guardians as part of your estate plan.
You don’t plan on going anywhere. But when the unexpected happens, your child can lose his or her parents. By naming a responsible person to take over, you can ensure that your child’s needs are always met, no matter what. But whom should you choose?
Finding the best candidate
Once you’ve narrowed down your choices, you may want to ask yourself a few questions about each possible guardian. For those under consideration, you may want to know:
- Are they willing to take over raising my child?
- Do they live so far away that my child must uproot his or her life?
Retained life estates let you give and live in your home
Many people find great reasons to include charitable giving as part of their estate planning, even beyond the chance to make a bigger difference in the world.
Organizations and causes that need the funds are too many to count, but there are many smart ways for gifting assets strategically that provide novel approaches.
One such strategy, the retained life estate, is a less than typical method, yielding certain advantages and cautions when included as a means of charitable giving in an estate plan.
Retained life estate basics
People who create a retained life estate often give their residential or other property to a charitable organization. They can specify that they will continue living in the property until they pass away or for some other specified period.
When the time comes, the charity can fully claim the property as its own. Universities, land trusts and environmental organizations often encourage donors to consider this long-term arrangement.
In A Domestic Partnership? Make Sure You Have A Will.
Say you’ve been with your partner for years. You live together and share certain assets together. Your lives are completely intertwined. Sure, you are not legally married, but you certainly don’t see yourself not being together. You both plan on spending the rest of your lives together, just without the legality of marriage.
There are plenty of reasons why a couple may decide to not get married, all of which are deeply personal. But what happens when one of them passes away? As it turns out, if you don’t have a will, your significant other may wind up with nothing.
No estate plans in place? Maryland law will decide
If two people are married – and one passes away – without a will saying otherwise, all or a majority of the decedent’s assets will automatically transfer to the surviving spouse.
However, when someone is not legally married and there is no will,Maryland’s interstate succession lawswill dictate what happens next. Who gets what and how much will all depend on whether the deceased person has children, living parents or siblings.
How important is business succession planning?
If you own a business, you likely spend a great deal of time thinking about the business and what you need to do to protect it.
However, you could be overlooking a critical component of running your business if you do not have a business succession plan in place. These plans can be critical to multiple parties, so it can be important that you have one.
Why it matters for you
Having a business succession plan allows you to make decisions for the fate of your business after you pass away (or retire or otherwise leave the business). Among other things, you will decide who will take your place, whether this is an employee, a family member or outside party.
Knowing that you have taken the necessary steps to leave your business in trusted, capable hands can give you great peace of mind that the right person will step in and take your place if need be.
Why It Is Important To Have A Detailed Estate Plan
To some people, the prospect of putting together their estate plan may be akin to medicine they know they need, but view as downright unpalatable. However, a skilled and experienced estate planning attorney can make the process of planning one’s own legacy a rewarding, and even pleasant experience.More importantly, a little effort and expenditure of relatively modest legal fees can prevent much family anguish and unnecessary expense later for heirs or other beneficiaries.
If you don’t bother to execute a will, the state of your domicile will create one for you effectively, under its laws of intestacy.You may be surprised at how your state intends to divide up your assets should you not provide specific direction. Even if you feel you don’t have much to pass on, you may want to consider donating certain funds or items to a favored charity, or passing down cherished mementos to friends, as well as (or instead of) your next-of-kin heirs.
For those with substantial estates, consider the potential conflict, costs and family discord that may come with probate litigation. An experienced estate planning attorney can steer you into documents to minimize that risk.
Protecting your e-legacy
As the digital age increasingly takes over more aspects of our lives, assets that hold tangible and sentimental value are not always something you can hold in your hands. Commonly referred to as digital assets, they can take many forms yet hold equal value to physical possessions.
These “e-assets” include:
- Facebook, Twitter, and other social media accounts
- Business and personal websites
- Professional blog pages
- Email addresses
- Digital libraries of music, movies, and books
- Digitized photographs and home movies from film and video
- Bitcoin and other forms of cryptocurrency
- Frequent flier miles
- Credit card reward points
Which assets should I include in a prenuptial agreement?
Creating a valid prenuptial agreement before marriage is an effective way to shield certain property and assets from division in the event of a divorce.
If you are considering having a prenup in place, then it can be wise to examine the items you own and determine what you may want to include in your agreement. Below are some common types of property that people protect with a prenup.
Types of property to include in a prenup
If you or your partner owns the following types of property, it would likely be prudent to address them in your prenup:
- Family heirlooms and property
- Business interests
- Real estate, including rental property
- Intellectual property
- Inheritances (received or anticipated)
- Pets (which are property in the eyes of the law)
- Investments
- Debts
- Retirement benefits
With offices in Bethesda, Silver Spring, and Washington D.C., The Eleff Law Group provides legal help to clients throughout the surrounding areas, including North Bethesda, Chillum, Potomac, Chevy Chase, Germantown, Takoma Park, Wheaton, Rockville, Towson, Glen Burnie, Bel Air, Montgomery County, Prince George's County, Baltimore, County, Loudoun County, and Fairfax County.
12305 Kemp Mill Road, Silver Spring, MD 20902
301-857-1990
