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UnexpectedPassing.com

Beyond Wills & Estate Planning
  • Home
  • First Steps
  • Death Planning
  • Funerals, Etc.
  • Financial Details
  • Real Estate
  • Digital Footprint
  • Subscriptions
  • Shared Stories
  • Checklists
  • About Us & Site Policies

Businesses & Royalties

Business Owner/Business Partner

Along with personal planning, if you have your own business or are a partner in a business, you need to consider arrangements for your business ownership interests after your death.


If you are a sole proprietor or jointly own a business with others, hopefully, you have contingency plans in place in the event of the unexpected passing of one of the key principals. 


Your lawyer or your business partners should have the document that verifies how to proceed with the next stage for the business - who will take charge and what will change.


Whatever happens, tangible assets will need to be appraised for distribution - whether the business is sold, liquidated, or redistributed among the partners. Outstanding loans may be called for immediate payment. Refinancing activities may be renegotiated. Taxes will need to be filed and paid until the deceased's share is liquidated or other avenues are arranged. 


While your lawyer will be able to help with the legal formalities, consider designating someone to act on your behalf to ensure an orderly transition. 


It is best if your family is aware of your wishes, and all parties are clear on your succession plans.


A Business Story Nightmare

  A friend of mine, whom I met early in our careers, shared her 'business ownership' nightmare with me one evening. 


Her father had been a "successful" businessman, who unexpectedly died at a young age. Her mother was not involved in the business and was unaware of any continuation plans for it.


The family business  collapsed after their father's death, and they were faced with a staggering debt load from the business and unpaid taxes. 


The lack of any pre-planning for business contingencies - like the death of the owner - resulted in my friend and her brother living at home and working to pay the business debts and taxes in order to maintain the family home for their mother.

Sole Business Owner

Inform the Family - Avoid Post-Death Surprises

All of the issues that one faces upon the death of a loved one are similar to the ones that one faces with a business:

  • Tangible assets need to be appraised and possibly liquidated
  • Business assets will need to be distributed if the business will not continue after your death
  • Any outstanding loans to the business may be called, with an expectation that they will be paid immediately
  • Taxes need to continue to be filed and paid, if necessary, until the business is dissolved


To facilitate this, you will need to make a list of everything that needs to be addressed and/or closed out, such as:

  • Company accounts, including loans
  • Outstanding accounts receivables
  • Accounts payables
  • Computers and the company files (including, erasing sensitive information prior to      disposing of equipment)
  • Building leases
  • Equipment leases
  • Inventory
  • Employees and/or retirees - income and/or retirement benefits


If the intent is that your solely-owned business will continue after your death, it is critical that you designate someone to legally take charge of post-death business affairs. 


Your family should be appraised of that person and any legal agreements regarding the succession - a copy of the document would be best. Also, ensure that the family has some idea of the business' current financial situation. They needs to be aware of future changes that would impact them directly, including future equity ownership, distributed assets, and liabilities.

Business Partnerships

Benefits Continue After Death

If you have a business partner, you will hopefully have a legal contract on the disposition of the business and its assets upon the death of one of the partners/owners. 


You will need to ensure that this is very explicit with respect to how the other owner(s) will compensate the family  you leave behind for your share of the company's  value.


Again, your lawyer and your family should have copies of these arrangements, and the documents need to be current. 

Photo Gallery

Royalties

Benefits Continue After Death

If you receive royalties for your work, remember that the royalties continue after your death. 


If you are an author, musician, actor, painter, photographer, songwriter, engineer or inventor with patents, this applies to you and all the other creative and innovative professionals who collect royalties, regardless of the field (from windshield wipers to medical devices). 


With your lawyer and financial planner, you should be looking at various options, including:

  • Having the royalties go to one or more family members
  • Establishing a trust to which royalties can be directed
  • Identifying a charitable organization to whom these should be directed


All of this needs to be clearly addressed in your will. Work with your lawyer or financial advisor to ensure that these are appropriately directed after your death. 

 

We have included links to other resources for more information below.


In conclusion, nothing will tear a family or business apart as quickly as arguments over money. Having the distribution of any assets clearly and legally established prior to your death is a blessing for those you leave behind.

Other Resources for Royalties

Authors

Royalties from an author's perspective

More

Music

The ASCAP website for an FAQ regarding music royalties after death  

More

Patents

Generally, patent royalties become the property of the estate.  The following links provides some general information, but again, we suggest you consult with your lawyers and financial planners for more specific information 

More

More on Financial Details

Accounts & Benefits

Remember: - unless a bank account is a joint account, you will not be able to access the money. Did the deceased qualify for government benefits?

More

Investment Portfolios

Generally investment accounts have specific beneficiary designations. These portfolios may be taxable or non-taxable retirement & educational savings or cryptocurrency accounts and more 

More

Insurance & Taxes

Dealing with Insurance and both individual and estate taxes

More

Other Featured Sections

First Steps

Death Planning

Death Planning

Where to begin the process

Step-by-step guide on what to do first. Calls, Paperwork, Care Arrangements and more...

More

Death Planning

Death Planning

Death Planning

Personal Information

Detailed guide to prepare or fulfill final wishes

More

Funerals, Etc.

Death Planning

Funerals, Etc.

New Orleans Jazz Funeral

Where do you start? Physical remains, funeral options, death certificates, memorial services and more...

More

Real Estate

Digital Footprint

Funerals, Etc.

Home & Property

Key reminders on seuring residences - owned or rented, apartments or houses - after a loved one's death

More

Digital Footprint

Digital Footprint

Digital Footprint

Social Media & Digital Footprint

What you need to know to protect and eliminate the deceased's digital presences

More

Subscriptions

Digital Footprint

Digital Footprint

Magazine Subscriptions, Memberships and more

Magazine subscriptions, memberships and more...

More

Subscriptions

Subscriptions

Subscriptions

Funny, helpful and special stories that others have shared to helpyou through the process

More

Checklists

Subscriptions

Subscriptions

Funny, helpful and special stories that others have shared to helpyou through the process

More

When I Leave You & Financial Details Checklist

When I Leave You - Our preplan document


Financial Details Checklist

When_I_Leave_You (pdf)

Download

Financial_Details_Checklist (pdf)

Download

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