What Happens to Your Michigan Business After You Die?
For business owners in Michigan, planning for their business’ future after their death is an important consideration. This article will consider what happens to a Michigan business after its owner’s death, the process of transferring a business, what happens when a business is not transferred to someone, and how an experienced estate planning attorney can aid throughout the process.
Transferring Ownership of a Business Upon Death
It is possible to transfer the ownership of a business to your heirs, or a trusted person or set of people, upon your death. One of the best ways to do this is to put your business in a trust. Transferring your business property to your living trust is a great idea, and is very simple to do (especially if your business is a sole proprietorship). If there are multiple owners, such as an LLC, you will need consent from other owners prior to putting your business interests into a trust.
You can also leave your business in a will, although items in a will do need to pass through probate, the process of which can be tedious and could tie up business operations.
What Happens When a Business is Not Planned for
When a business and its property and assets are not planned for and are not placed in a trust or named in a will, what will happen to the business depends upon the type of business structure. For example, a business that is formed as a sole proprietorship will simply become part of the owner’s (decedent’s) estate, and will be distributed to beneficiaries per the terms of a will or per state law. If a business is not solely owned, such as a corporation, the business will not die when the business owner dies. Instead, the owner’s estate becomes the owner of the decedent’s shares.
How an Experienced Grand Rapids Estate Planning Attorney Can Help
Each state has its own laws regarding property distribution upon death, and each type of business must be planned for differently. If you have any business interests in Michigan, it is best that you plan for what will become of these interests now while you are healthy and well; waiting too long could be catastrophic, and if you fail to create a plan at all, your business may be dissolved, and your heirs may be left with nothing.
At The Law Offices of David L. Carrier, P.C., we understand what it takes to protect your business and your loved ones. To schedule a free case consultation to learn about our business and estate planning legal services in Michigan, contact us online today. You can also call our offices directly.