Essential Planning Tips For Small Business Owners

Whether you are raising a family or running a business, here's some practice tips to consider to get your estate in order.

By: Lori T. Williams, Owner/Managing Attorney of Your Legal Resource, PLLC

The saying goes, “People don’t plan to fail, they just fail to plan”.  Estate planning is something many of us have a tendency to put off.  Attorney Jennifer Harvey shares some tips on what you need to consider as a business owner, when planning for your estate.

Jennifer began her legal career as outside legal counsel for Ford Motor Credit Company, handling business contracts, litigation, and estate planning.  She decided to create her own practice to help small business owners protect their families in the event of death or incapacity, and to protect their business from liability. Her company slogan is “taking care of you and your family when you can’t.”

Jennifer, why is it important to utilize the services of an estate planning attorney rather than other resources when it comes to estate planning?

Much of what I do involves making sure that our clients are properly informed about their estate planning options.  I often hear about and experience people who have put their trust in internet resources that are inaccurate and do not speak to their situation.  Estate planning and probate law differs from state to state.  Also, it is difficult for an internet researcher to know who actually drafted an internet article or when it was written.  It is important for each person to find the right attorney who specializes in the area of the law that they need and have candid and thorough discussions with him or her to achieve the client’s goals.

Are there any pressing legal issues to consider in the area of Estate Planning?

Yes, two hot topics come to mind:

(a)    The deed beats the Will! 

In estate planning, the deed always beats the Last Will and Testament – that is, if the deed states that a second person is a co-owner with the client or listed as a beneficiary on the deed, the deed controls which beneficiary receives the property at the client’s death.  If the client set up a Will that contradicts the deed, the Will loses and the deed wins.  It is important for an estate planning attorney to make sure that each client’s deeds cooperate with and achieve the goals of each client’s estate plan.  I can’t tell you how many times I have had to probate an estate just because of poor planning.  Probate and results contrary to what a client wants can be avoided by diligent planning.

(b)   Short sales for a decedent’s real estate.

Due to the current real estate market, I often help clients whose parents died and left a house or condo where the mortgage is greater than the value of the property.  Sadly, family members are often denied the opportunity to buy the home in a short sale from the bank because such a sale is considered by the bank to not be “an arm’s length transaction.”  Sometimes families are faced with whether to use money from a deceased parent to pay off the mortgage or let the home go into foreclosure.  There are both financial and emotional issues to contend with, especially if there are many sibling beneficiaries involved.  I highly recommend that people in this situation seek the advice of a qualified attorney to learn about and weigh their options in this situation.


Since it’s the New Year, what planning tips might you offer business owners to get their affairs in order?

(a)    If you’ve never done estate planning, the time to begin is Now!

If you had an estate plan at one time, find your old plan and legal documents for household and your business and determine the following things:

How long has it been since they were updated?

Has your business or family grown or changed since the documents were prepared?

What else has happened in your life, the lives of your loved ones, or the lives of your business colleagues since those documents were prepared?

If there have been changes, review the documents with a qualified estate planning attorney.

Get the appointment on the calendar, don’t put it off any longer.

(b)   Talk to your parents and elderly relatives about their estate planning.

I find that a good way to make conversation about this is to discuss what happens when celebrities pass away without proper planning – we can learn much from the errors of Michael Jackson, Princess Diana and Sonny Bono.

(c)    Talk to your friends, relatives, neighbors and co-workers who have children under the age of 18 to ensure that they have guardians named for their kids in the event that they die.

We wouldn’t let our kids stay with just any babysitter; so much more important is who would act as their guardian in the event of death.  It is important to choose who the guardian would be, and have the right lawyer put your wishes in place. Don’t leave this important decision up to a probate judge!

If someone has a special needs child, regardless of age, a special needs trust should be put in place to ensure that the special needs child can get an inheritance or support from their parents without losing their valuable governmental benefits.

What are some common misconceptions about estate planning?

That it takes too long, is too complex, and is too expensive.

Nothing is further from the truth, if you hire a qualified attorney to assist you.  That attorney can give you a timeline for completing the documents and handle the matter for you.

As for cost, you can talk to an attorney and know what planning will cost you upfront.  If things go wrong and there is no plan in place, it is going to be much more costly to hire a lawyer after the fact, than if you had hired one to properly plan. Rather than thinking “I can’t afford an estate plan,” business owners and heads of households should be thinking, “I can’t afford to NOT have an estate plan and my family can’t afford for me to NOT have an estate plan.”  It’s important to have these documents in place.  To avoid the tendency to procrastinate, I suggest clients commit to have them finalized within 90 days of our initial conversation, to make sure they get it done and don’t have to worry about it.

If you itemize your taxes, you can often use an estate plan for a partial write off on your taxes.  This might provide another incentive to get your affairs in order.


Jennifer M. Harvey is the founder and managing partner of Harvey Legal Group, PLLC.  She focuses her practice in the areas of estate planning, probate and business law.  Ms. Harvey is faculty for the Institute of Continuing Legal Education (ICLE) teaching other attorneys about estate planning and estate administration. For more information, visit her website.

Lori T. Williams is a 22 year attorney based in Birmingham, MI. She owns a legal referral and legal consulting business called Your Legal Resource, PLLC. She assists individuals and small businesses in need of legal advice or representation by connecting them with the right legal specialist for their situation. She also provides consulting services for attorneys and other professional service providers on how to generate more business through effective branding, marketing, networking, and by creating strategic partnerships. For more information, visit www.bestlegalresource.com.

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