Partnerships and closely held businesses may be a problem when planning an estate due to the uncertainty regarding the valuation of the shares and ability to sell an ownership stake. The use of a buy-sell agreement may make planning easier by setting in stone procedures for buy out and valuation upon the death or retirement of a shareholder. Business partners will often support these agreements as it guarantees continuity of management and prevents outside parties from entering the business. Bring it up with any client who might need one and explain the benefits that might come from the certainty an agreement offers.
See Fox, Shjeflo, Hartley & Babu LLP, Buy-Sell Agreements: Good For Business and Good For Your Estate Plan, JD Supra, June 5, 2015.
Special thanks to Jim Hillhouse for bringing this article to my attention.
