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Succession Planning

two brothers

For the owner of a business, a goal of succession planning often is preserving the wealth of the business while passing on a legacy. An owner wants the business to survive and to maximize its value.

A concern that can face a business owner is how to orderly and affordably transfer the business to the next generation or a key employee. With planning, adequate time and guidance from one of our experienced bankers, business succession can be accomplished without negative financial consequences, whether an owner is planning for retirement or looking for a smaller role in the business for more time for new endeavors.

Failure to plan for business continuation can result in monetary loss and even loss of the business itself. For example, estate taxes alone can gobble up a significant percentage of a taxable estate, forcing a business to liquidate or incur debt to insure its continuation.

Questions you’ll want to consider include:

  • How to maximize the value of my business?
  • How to minimize the potential tax liability of transferring ownership of the business?
  • Where will the money come from to pay taxes or buyout a partner’s share?
  • Will adequate capital be available to carry the business through a transition to a new owner?
  • Should funding vehicles, like life insurance, annuities and disability insurance, play a role?
  • How to best transfer the trust, respect and goodwill in the business that’s been built up over the years to the next generation of ownership or owners-to-be.
  • How to recruit and develop “bench strength” for successful succession?

It is our goal to offer you assurance that your business succession plan achieves your goals. If seeing your business continue in the future, without compromising your own retirement needs, is important to you, contact your local American Federal Banker today.

This information offers general advice and is not intended to be marketing, legal or tax advice. Consult your attorney, tax accountant or other professional.