Planning
Decide who gets the business — before someone else decides for you
If you died tonight, your business would still transfer. To someone. On terms set by a document you may not have read, or by a probate court, or by whichever family member moves first. Succession planning isn't about whether the transfer happens. It's about whether you're the one who decided it.
The problem
Most owners we sit down with have some version of a plan. It's usually one of three things: an operating agreement drafted years ago and never revisited, a handshake with a partner, or an assumption about which child will step up.
None of those are plans. They're intentions. And the gap between them shows up at the worst possible moment — when the person who understood the intention isn't there to explain it.
The pattern is consistent and it's brutal. A partner dies. The surviving partner suddenly owns half a business with a grieving spouse who wants cash, doesn't want to run anything, and is legally entitled to a share. There's a buy-sell agreement in a drawer that says the survivor will purchase the interest. Nobody funded it. Now the business either takes on debt it can't service, or it sells.
Who this is for:
- Owners with a partner, at any ownership split
- Family businesses where one child works in it and others don't
- Anyone whose operating agreement hasn't been reviewed in five years
- Owners planning to sell within ten years who haven't looked at what the business is actually worth
- Anyone whose answer to "what happens if you're not here Monday" is a pause
What's involved:
Step 1. Establish what the business is worth.
Not what you hope, and not what you told the bank. A defensible number, because every decision after this depends on it — and because the IRS will form its own opinion if you don't.
Step 2. Read the documents you already have.
Operating agreement, buy-sell, any prior arrangements. We look for the gap between what they say and what everyone assumes they say. That gap is almost always there.
Step 3. Decide the actual transfer.
To a partner, to family, to a key employee, to an outside buyer, or wound down. Each has different mechanics and different tax exposure — questions we walk through with your attorney and CPA, not around them.
Step 4. Fund it.
This is where most plans fail. An unfunded buy-sell is a promise, not a plan. Life insurance is the most common funding mechanism because it delivers cash exactly when the triggering event happens, which is the one thing a loan or a sinking fund can't guarantee.
Step 5. Review it annually.
Businesses grow, partners leave, children change their minds. A plan built once and filed is a plan built for a company that no longer exists.
Common questions
Good — most people don't. The next question is whether it's funded, and whether the valuation method inside it still makes sense. Those are the two places we find problems.
They might. But "figure it out" while grieving, with a business to run and a tax bill arriving, is a heavy thing to hand someone. And if one child works in the business and others don't, "figure it out" is where families come apart.
The documents are. The funding isn't, and the coordination usually isn't either. We work alongside your attorney and CPA — the plan doesn't work if the three of us have never spoken.
The first conversation is ninety minutes. A full plan usually takes a few months, mostly waiting on valuation and legal drafting. The insurance piece is generally the fastest part.
Nothing.
This material is for general information only and does not constitute tax, legal, or investment advice. Individual circumstances vary. Consult your own tax advisor and attorney before acting on anything described here.
Start with a conversation, not a proposal.
Bring your operating agreement and buy-sell if you have them. We'll tell you what they actually do.
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