Do You Know How Businesses Transfer To Children?

If you’re a parent, you experienced the singular joy in life that is conceiving and creating, then raising a child. If you’re like most families, you had more than one. You spent years of your life raising them to be adults and contributing members of society. Yet, even in your waning years, you still want to look out for them. That might include eventually transferring your business or share of a business to them.

What matters a lot here is whether or not you’re still alive, and what state you live in. The rules, regulations, and laws surrounding the transfer of property or business ownership vary more on the municipality and specific state than national or federal statutes. Checking with an Alameda County estate planning attorney, tax attorney, or corporate lawyer is advisable.

If you’re looking to set things up for business transfer to your children upon your death, then a life insurance policy might be a good idea. Some policies can be setup to provide for the child or children to have the funds available to take over your share.

If you’re looking to retire and pass on ownership, then you might actually retain your worth and share of a company, but just instead make them the managing partner or majority shareholder, which is more of an internal matter.

In both cases, if you’re not the only owner of the business, check the bylaws of the company to make sure it’s even technically possible to do so. Also check with other partners or owners of the business to see if they’re okay with it. Even if they don’t have the power to stop it officially, going against their wishes might put your child in difficult circumstances, particularly if they don’t actually want to be a part of the business.