Based on the results of a nationwide survey, many Florida business owners may not have estate plans. The survey, which asked questions of more than 500 business owners, revealed that only about 70 percent have an estate plan in place. Of those who do not, around 30 percent said they did not think it was necessary and around half said they avoided it because they found the topic unpleasant. Many of the business owners had outdated estate plans. Only 12 percent were less than two years old while more than half were more than five years old.
Furthermore, around 70 percent of those owners have had significant events in their lives like births, deaths, marriages and divorces since they created their estate planning documents, and more than 50 percent say they are now wealthier. An outdated estate plan may also fail to take advantage of the most current tax laws.
Estate planning is an important task for a business owner. If anything happened to the individual that owned the business, both the family and the company could be thrown into disarray. This may be true as well for owners who have outdated business plans.
While estate planning may involve thinking about unpleasant subjects and making difficult decisions about which loved ones should receive what, failing to do so may make things much more difficult for all concerned. Actions as simple as providing a list of all assets and passwords as well as more complex ones such as setting up trusts can all ensure that an individual's wishes are carried out after their death. It may be helpful to work with an attorney who may ensure that legal documents are in order and prepared correctly.
Source: Forbes Magazine, "Most Business Owners Do Not Have Up-To-Date Estate Plans, But They Should", Russ Alan Prince, Feb. 24, 2015