Business Continuation Planning

Many estate planning attorneys are not familiar with effective business continuation strategies. Business continuation planning, commonly referred to as buy-sell planning, is the planning for the disposition of a closely-held business interest in the event of the death, retirement, or permanent disability of the business owners.

An individual shareholder’s overall estate planning should incorporate buy-sell planning for the transfer of stock within the shareholder’s family. Shareholders can use buy-sell planning in connection with the company’s life insurance plan, which may help prevent future legal battles between the corporation and a deceased shareholder’s family.

For more information, including two case studies that demonstrate different planning situations and possible solutions, see Peter Katt, Business Continuation Planning: Part II, 12 Life Ins. Persp. 9 (2010). See also Peter Katt, Business Continuation Planning: Part I, 12 Life Ins. Persp. 8 (2010).

Special thanks to Jim Hillhouse (WealthCounsel) for bringing this to my attention.