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Home » Uncategorized » Importance of a solid succession plan for your business

Business owners in New Jersey work hard to build their businesses. They build relationships with clients and customers as well as a reputation. Many become successful and build solid businesses. However, at some point in time, business owners will no longer be able to run their business any longer. Business owners may not want the business to close though.

They may have many employees who rely on the business being open or simply want the business to continue to provide their services or products for customers and clients. In order for the business to continue though, they will need reliable people to run it for them once they are unable to do so.

Considerations for a good succession plan

That is why succession planning is important and is something that needs to start well before business owners are in a position where they will no longer be running the business. Business owners first need to determine who they want to take over. This could be a family member or a current employee.

The training needs to start far in advance of the succession to ensure that they have the right person and to ensure that they are ready to start running the business right away after the succession.

There are also other considerations that people need to consider. This is especially true if people are passing the business on to a family member. There could be tax consequences people need to consider. These include estate taxes, gift taxes, generation-skipping taxes and income taxes.

No one in New Jersey can run a business forever. If they want to ensure that the business will continue to run after they retire, become incapacitated or pass away, they will need a succession plan. Training people with the leadership skills necessary to run the company is important and that process needs to start sooner than people realize.

In addition to choosing who will run the company, people have financial and tax issues they need to be aware of as they pass the business on. Experienced attorneys understand how to develop a good succession plan and may be able to help guide one through the process.