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Business owners should consider estate planning

On Behalf of | Jul 5, 2022 | Estate Planning

Everything comes to an end one day. Most Ontario residents don’t like to think about it, but it’s a reality that can’t be escaped. For those who own businesses, it’s especially crucial that estate planning documents exist in the event an owner dies unexpectedly. It’s better to be safe than sorry when it comes to leaving a business behind in the hopes it will continue to flourish.

Security for family members

An estate plan not only benefits a business, but it also benefits any loved ones left behind. Without any formal wishes written down, a business could be in dire jeopardy, and loved ones could face the added stress of having to sort out the deceased person’s affairs. So, here is some advice for business owners who have not yet taken the time to create a comprehensive estate plan:

  • More than a will is needed: A will is just one of the important documents in a comprehensive estate plan.
  • Planning to minimize taxes: Working with a professional to reduce the future amount of taxes owed can help maximize the beneficiaries’ inheritance.
  • Remember to address any shareholders’ agreements and family contracts: Speak to any important documents that may be in existence, such as a prenuptial agreement or sales of shares, etc.
  • There can be two powers of attorney: One power of attorney can take care of personal issues, while the other can deal with business issues.
  • Life insurance policy owned by the business. Such a policy can thwart any burden on a business if the owner dies without sufficient funds to pay taxes on his or her shares held at the time of death.

Even if an Ontario business owner has been operating a business for years without a comprehensive estate plan in place, it’s never too late to begin. An experienced estate planning lawyer can help guide someone through this process, ensuring one’s final wishes are met and increasing the odds of one’s business continuing to thrive into the future.

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