A good business succession plan strikes a balance between maximizing returns for the current ownership generation and the subsequent generation’s long-term goals. If you own and operate a business in North Dakota, it is important to employ the services of an experienced legal team to establish a succession plan.
Why is a business succession plan important?
A good succession plan strikes a balance between current and future ownership generations. Still, on a more fundamental level, it specifies the roles your inheriting generation occupies within your business. Another way of explaining it is when the time comes for the official transition of ownership, there will be no unforeseen problems concerning the merits or entitlement of the inheriting generation.
Even if your business has been in your family for generations, it is imperative to set up an agreed-upon corporate structure for its official sale. By specifying the form in which your business is to be passed or sold to an inheriting party, you allow for flexibility in the event of future complications but establish a structure that will move the succession plan forward. A sale of stock is a popular option because of its simplicity and minimal paperwork. Other common means of succession include selling your business as a collection of assets, leaving it as a gift or bequeathing it.
Get professional help with your succession plan
Business succession plans vary immensely based on the business’s size, whether it’s family-owned and state tax laws. Regardless of specifics, most succession plans involve careful coordination between accountants, consultants and attorneys. It’s common for business owners to neglect their succession plan until the last minute, which can lead to numerous, costly problems. Employing an experienced legal team’s services to address your succession plan in a timely, effective manner gives you peace of mind and can even help your business thrive long-term.