For those in Ohio who own a business, ensuring that the business continues to operate after one’s death is often a primary concern. Many people have made their business venture one of their top priorities throughout their lives, and want to see that hard work passed down to future generations. Through comprehensive estate planning, that goal can become reality.
One way that business owners can use estate planning to ensure the longevity of their business is to create a grantor retained annual trust (GRAT). This is a financial planning tool that allows business owners to transfer business assets into a trust, with the intent of passing those assets down to the designated beneficiaries when the time comes. Because the assets are technically “owned” by the trust and not the business owner, they are shielded from excessive taxes as the assets appreciate over time.
Another reason why estate planning is so important for business owners is that it gives an owner the ability to ensure that his or her message is able to live on even after the owner has passed away. An example is found in the life and legacy of Alfred Nobel, who is the mind behind the Nobel Prize. Through careful and comprehensive estate planning, Nobel was able to create an institution that remains in place today, and serves to recognize and reward excellence in human ingenuity.
For Ohio business owners who would like to learn more about how estate planning can help them achieve various business goals, it is important to take the time to meet with an estate planning attorney. He or she can go over the various tools used to create a business-minded estate plan, and can answer any questions concerning the process. This is an area of financial planning in which there are no one-size-fits-all solutions, giving business owners the ability to create a package that is tailored to their specific needs.
Source: The Huffington Post, “5 Things Estate Planning Can Do for You and Your Business“, Kc Agu, March 31, 2016