How Do I Give My Son My Business?

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Transferring Business Ownership to Family Members

When your time at the business you created draws close, it’s essential to start creating a plan for the future. Handing your business down to a family member is a proud moment. Yet, like many small business owners, you may have put aside creating a formal plan to transfer business ownership to a family member. If you have more than one family member who is interested in taking over the business, it’s important to have a clear plan for how ownership will be transferred.

  1. Starting Your Succession Plan
    Your succession plan should be grounded in an honest assessment of your company’s future, and the interest and capabilities of your potential successors. Draft a contract that outlines the terms of the transfer.

  2. Legal Considerations
    Get It Valued Accurately. For transferring business ownership to family members, it’s crucial to have proper documentation, including a buy-sell agreement. Make sure that your documentation is thorough.

Passing Business to Next Generation

My father wants to retire and pass on his business. What is the best way to transfer a company to the next generation (my father to me) without any liabilities associated with the past company? If you want your child or grandchild to inherit the company, there is a certain process you’ll need to follow to ensure that ownership is properly transferred.

Transferring Property to Family Members

To transfer a property to a beneficiary, download and fill in the following forms: How to transfer ownership of a property to a family member? Usually achieved in three simple steps: Sign Property Transfer Deed (a Quit Claim Deed is most often used in these cases).

Tax Implications and Considerations

You can’t simply gift your kids an unlimited amount of tax-free money without reporting it to the IRS — a gift tax exists to discourage sheltering income in “gifts.” The most common way to transfer property to your children is through gifting it. This is usually done to ensure they will not have to pay inheritance tax when you die. Inheritance tax starts at 40%.

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