Attorney
A small business can represent years of work, important relationships and a meaningful part of a family’s financial security. Including it in your estate plan helps the people who may someday need to manage, transfer or sell it understand what you intend.
Consider the available paths
There are more than two possibilities. The business might continue with family members or existing managers, be sold as an operating business, or be wound down with its assets sold and obligations addressed. A plan may combine these approaches or provide alternatives if circumstances change.
Think about what is practical as well as what you hope to achieve. A business closely tied to the owner’s personal services may face different challenges from one with an experienced management team and established systems.
Passing a business to the next generation also calls for an honest discussion about whether family members want the role. A thoughtful sale or orderly closure can be an appropriate outcome when continuing the business would place unrealistic demands on them.
Review existing agreements
Operating, partnership and shareholder agreements may govern what happens upon an owner’s death or incapacity. Buy-sell agreements, loan documents, licenses, leases and important contracts may also restrict a transfer or affect the timing and terms.
Do not assume that a will or trust can override those obligations. Ownership rights and management authority may be different, and the intended successor may need approvals or qualifications before taking an active role.
Prepare the people who will be involved
A successor should be willing, capable and supported by practical preparation. Identify the experience needed, opportunities for training and the employees or advisers who can help maintain continuity.
Clarify who can act immediately if the owner becomes unavailable. Access to essential records, authority over accounts and communication with employees and customers should be considered before a crisis occurs.
Coordinate value, funding and family needs
Whether an interest is transferred during life, through a trust, under a buy-sell arrangement or as part of an estate, valuation and tax consequences deserve attention. A gift, a sale and an inheritance may have different income- and transfer-tax effects.
Consider how the owner will be supported after a lifetime transition, how a purchaser or successor will fund a buyout and how family members outside the business will be treated. An estate with substantial business value may still need accessible cash for expenses and other obligations.
If a wind-down is the best course, identify who will oversee it and what must happen to employees, customer commitments, inventory, equipment, contracts and records. The plan should address liabilities and administration costs before assuming that all sale proceeds can be distributed.
We can help coordinate business succession planning with your personal estate plan and the work of your tax and financial advisers. Contact Verras Law to discuss the future you want for the business and the people who depend on it.
Sources: Federal estate-tax overview.
Updated October 26, 2026.