A Case Study in Succession Planning

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Should the Sons Start a New Business Entity?

Succession planning for a closely-held business has many potential pitfalls, including:

  • Reluctance of the founder to relinquish control
  • Absence of family members ready to run the business
  • Squabbles over control of the business
  • Concerns about how to value the business and equalize distributions of the founder’s estate.
  • Income and gift tax liability

Consider the following hypothetical case.

Background

Dad, the family patriarch, has a wholly-owned corporation (“POP, Inc.”) that has operated a family business for 40 years. Recently, however, regulatory authorities have been particularly critical of certain aspects of the “old school” way the business is being conducted, asserting regulatory …read more

Read more here:: Tax

About Aronson LLC

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Aronson LLC has been thinking ahead for its clients for more than 50 years. Aronson’s construction, real estate, government contracting, nonprofit, technology and private industry experts provide innovative audit, tax, and consulting services that help its clients move to the next level. From start-up to exit strategy, Aronson works with companies throughout the entire business lifecycle by proactively identifying opportunities and addressing challenges so that clients are able to focus on their core business. Aronson shows companies how to rethink everything to be more profitable, more competitive and better prepared for the future.

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