Starting a new business venture serves as an exciting and fun way to mark a new chapter in your life. However, you also need to plan for the potential uncertainties that the future may hold, especially with a business at stake.
Estate planning should serve as a priority when you enter a new business venture if only due to the possibility of sudden incapacitation or even death. Ironing out these details in advance can save you and your loved ones a lot of heartache and headache later.
Avoid creating conflicts
The New York State Senate discusses laws that govern partnerships and how that may affect the drafting of your estate plan. Note that as a business owner and someone with a family, you need to simultaneously safeguard their interests while also serving any obligations you hold toward employees or partners.
First, avoid conflicts with obligations that already exist. Do not contravene any terms of agreements already existing between your partners or laws governing these partnerships in your estate plan. This includes your living will, will and power of attorney.
Create a buy-sell agreement
Next, create a buy-sell agreement. This contract exists between co-owners and determines what happens to the business in the event of a partner leaving the company or dying. It protects the remaining business owners and states clearly what will happen to the remaining assets.
Choose your power of attorney
Identify your power of attorney next. This person will make business decisions on your behalf if you find yourself incapable of doing so, including spending, receiving and accessing your funds. Thus, you want someone you can trust no matter what.
You may also want to contact legal aid while working on this plan, as they can ensure you have coverage for all important matters in your home and business life.