Estate planning is important for all Pennsylvania residents, particularly if they own a business or property. One document that business owners should consider as part of their estate plan is a power of attorney. A medical or financial power of attorney gives another person authority to make certain decisions for someone else if that other person becomes mentally incapacitated.
Business owners should also think about their succession plan, which is a document that spells out how a business should be run or shut down if the owner becomes incapacitated or dies. This plan should include details regarding who will take over the business, either to sell it or to run it, and whether a person’s ownership share should be sold to a business partner. This plan should be discussed with co-owners and with any friends or family members who the owner wants to take over the business.
Another part of estate planning is getting all relevant types of insurance in place. For someone with a spouse and children, it is generally a good idea to invest in life or disability insurance. Business owners may also want to consider key person insurance, which can attach to a business to cover some expenses if something happens to the owner.
Anyone who creates an estate plan should determine whether his or her assets will be passed along through a last will and testament or through a living trust. Each estate plan is person-dependent, but it is a good idea for everyone to have documents identifying which person will inherit which assets. Without an estate plan, assets are considered intestate and are passed along in accordance with Pennsylvania inheritance laws, not in accordance with a decedent’s wishes. An estate planning attorney may go over the different estate plan options in more detail.