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5 Replies Last post: Sep 8, 2008 3:27 PM by LUCKIEST

Family Business - passing to next Generation

Sep 8, 2008 2:22 PM

sfrepomom 2 posts since
Sep 8, 2008

Hi -

I am the Operations Director for a family run repo business. The owner, my dad is 78 years old and health is being a factor.

I would like to know what I need to do the facilitate the "transfer" of the business to have me as the successor. This is mostly so that my mother would have a means of income as well. There are siblings, however there are none that have any interest in the business, running it or otherwise - so they say.

Can you make a few suggestions - quick and simple - I know that there are tax issues and valuation issues, however I just want the irs to stay out of it and also, we don't want any probate issues.

Any advise would be great.
Thanks!!

Tags: small_business, management, running, small, business Report as inappropriate

Fortis 239 posts since
Jul 24, 2008

1. Re: Family Business - passing to next Generation Sep 8, 2008 2:34 PM

Is the company a corporation? Sole Prop? LLC?

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sfrepomom 2 posts since
Sep 8, 2008

2. Re: Family Business - passing to next Generation Sep 8, 2008 2:44 PM

in response to: Fortis

This is a corporation

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Fortis 239 posts since
Jul 24, 2008

3. Re: Family Business - passing to next Generation Sep 8, 2008 2:49 PM

in response to: sfrepomom

Do you have a lawyer that formed the corporation? If not then I would suggest talking with one.

What you could do and this is only opinion as I am not a lawyer is rewrite the corporation papers, do a resignation of director, stock purchase agreement, and a form that reassigns the directers ie pres, vp, etc..

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Lighthouse24 2,396 posts since
Oct 10, 2007

4. Re: Family Business - passing to next Generation Sep 8, 2008 3:24 PM

It seems that there are two issues to attend to -- (1) who legally runs the company, and (2) who owns the stock in the company. As already suggested, the first can be be dealt with procedurally, as dictated by your articles. The second probably requires an attorney and more specific guidance about what you want to achieve and/or avoid. For instance, the stock could be sold/transferred, bequeathed, placed in a revocable trust -- there are a variety of alternatives (each with pros and cons) depending on your objectives and concerns. Best wishes to you and for your father.

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LUCKIEST 7,935 posts since
Aug 6, 2007

5. Re: Family Business - passing to next Generation Sep 8, 2008 3:27 PM

Family Business - passing to next Generation, Welcome

It is so GREAT that a family business can be passed to the next generation.
I am guessing that you or the business has both an Accountant and a Lawyer.
That would be a good start, to help with the "transfer".

Then there is SCORE. SCORE is FREE and they are a great asset and can help.

Good luck, LUCKIEST

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This Question is Possibly Answered

Family Business - passing to next Generation

Sep 8, 2008 2:22 PM

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