As a business owner, you work hard to build up your company and should strive to protect it in both the near term and the long term. A strong estate planning strategy helps you accomplish just that, while also ensuring that your business continues to be a source of stability for your family.
A revocable living trust is a versatile estate planning tool. Your living trust can safeguard your business in ways that a last will and testament can not, so it is important to understand the extent to which a living trust can benefit you.
Control business succession matters with a living trust
Placing the ownership of your business in a living trust allows for the seamless and immediate transfer of that ownership to your named beneficiary upon death. You can also control circumstances surrounding the succession of your business, such as stipulating that your beneficiary might only assume temporary ownership in the event that you become incapacitated.
Avoid disruptive probate procedures with a living trust
A living trust also protects the succession of your business from going through the probate process. A simple will that goes through probate is public, which may not be preferable in regard to sensitive business matters. The probate court must also adhere to strict business succession laws which entail carefully evaluating the validity of the will. It may be months or years before the finalization of probate, during which time your business and your family might sustain significant burdens and financial loss.
A living trust gives you control of how ownership of your business will transfer upon your death or incapacitation while also eliminating the need for probate. Terms of a living trust are also revocable, allowing you to update the estate plan as you see fit during your lifetime.