• Skip to primary navigation
  • Skip to main content
  • Skip to primary sidebar
  • Skip to footer

Nirenstein, Horowitz & Associates P.C.

Estate Planning | Making a Difference One Family at a Time

An Estate Planning Law Firm
Making a Difference One Family at a Time

Call Now: (860) 548-1000

Attend a Complimentary Seminar
  • Facebook
  • Instagram
  • LinkedIn
  • Pinterest
  • RSS
  • Twitter
  • YouTube
  • Home
  • Our Firm
    • About Our Firm
    • Careers
    • Client Testimonials
    • Meet Our Team
  • Services
    • Asset Protection & Business Planning
    • Estate And Gift Tax Figures
    • Estate Planning
    • LGBTQ Estate Planning
    • Loss of a Loved One
    • Pet Planning
    • Powers of Attorney
    • SECURE Act
    • Special Needs Planning
    • Trust Administration and Probate
  • Elder Law
    • Alzheimer’s Disease
    • Caregiver Information
    • Emergency Medicaid & Nursing Home Planning
    • Guardianship & Conservatorship
    • Hospice Care
    • Medicaid Planning
  • Resources
    • Complimentary Estate Planning Worksheet
    • Complimentary Medicaid/Long-Term Care Calculator
    • DocuBank
    • Elder Law Resources
      • Glastonbury Elder Law Resources
    • Estate Planning Articles
    • Estate Planning Checkup
    • Estate Planning Definitions
    • Estate Planning Presentations
    • Estate Planning Seminars
    • Estate Planning Techniques
    • Frequently Asked Questions
      • Asset Protection and Business Planning
      • Elder Law & Medicaid
      • Estate Administration
      • Estate and Gift Tax
      • Estate Planning
      • Frequently Asked Questions for Families Without an Estate Plan
      • Incapacity Planning
      • In-Home Elder Care
      • Irrevocable Trusts
      • LGBTQ Estate Planning
      • Living Trust
      • Medicaid Planning
      • Nursing Home Asset Protection FAQs
      • Probate
      • Probate Avoidance
      • SECURE Act 2.0
      • Trust Administration
      • Wills
    • Newsletters
    • Probate Resources
      • Probate Resources
    • Published Books
    • Reports
      • Advanced Estate Planning
      • Basic Estate Planning
      • Estate Planning for Niches
      • Trust Administration
  • Seminars
  • Communities We Serve
    • Fairfield County
      • Darien
      • Fairfield
      • Stamford
    • Hartford County
      • Avon
      • Hartford
      • Simsbury
      • West Hartford
    • Litchfield County
      • Watertown
    • Middlesex County
      • Middletown
      • Old Saybrook
    • New Haven County
      • Middlebury
      • New Haven
    • New London County
      • Groton
      • Old Lyme
      • Stonington
    • Tolland County
      • Mansfield
    • Windham County
      • Woodstock
  • REVIEW US
  • Blog
  • Contact Us
Home » Estate Planning » Consider This Succession Strategy for Business Partners

Consider This Succession Strategy for Business Partners

August 6, 2020 by Barry D. Horowitz, Estate Planning Attorney

buy-sell agreementSmall business owners face certain estate planning challenges, and this can be particularly true when there is a partnership. What would take place if one business partner was to pass away?

There is a business succession solution that is often utilized when this type of scenario exists. Let’s look at the details.

Buy-Sell Agreements

Let’s explain by way of example. Suppose you are one of three small business partners. Your business is thriving, and the share that is owned by each respective partner is quite valuable. The share that you own is actually your most significant monetary asset, and you would like its value to be spread among multiple different heirs after you pass away.

How could you make this vision a reality? If you simply allow your family to sell your share after you die, your partners would be placed in a helpless situation. They would have no say over the new partner’s identity. You would be in the same position if you were a surviving partner, so everyone would be on equal footing.

Under these circumstances, you could use a buy-sell agreement as an estate planning solution. If you use the cross purchase plan, each partner would take out a life insurance policy on the others. The value of the combined policies would be calculated to equal the value of a business share.

After one partner passes away, the two surviving partners would receive their insurance policy payouts. These proceeds would be combined to purchase the share of the business that was owned by the deceased partner.

The remaining partners could then go forward as usual, and there would be liquidity that could be distributed among the heirs.

There is another type of buy-sell agreement called the entity purchase or stock redemption plan. Everything is more or less the same with regard to the utilization of life insurance to provide liquidity, but the difference is that the business entity would purchase the life insurance policies on the lives of the partners.

A buy-sell agreement can potentially be a good choice if you are a partner in a small business, but you would do well to discuss all the details with one of our estate planning attorneys so that you have a full understanding of the strategy.

Take Advantage of Our Free Resources

We are glad that you found a way to this blog, and we urge you to visit us often, because it is always updated with fresh, timely information. This being stated, we have additional written resources that are available to you free of charge.

Our special reports cover many different important estate planning and elder law topics, and you can download any or all of them. To check out the titles, visit our special reports library and follow the instructions to access your copy of any report that interests you.

Access Our Worksheet

Our estate planning attorneys have devised a very useful worksheet that you can use to gain a more complete understanding of the estate planning process. It is being offered free of charge right now, and we urge you to take advantage of this learning opportunity.

To get your copy, visit our estate planning worksheet page and follow the simple instructions to gain access.

We Are Here to Help!

All of the information that we offer in writing is extremely valuable, and we encourage you to take full advantage of these opportunities to build on your knowledge.

This being stated, at some point, it is time to have a meaningful discussion with an estate planning attorney so that you can put a plan in place. Every situation is unique, so it is important to devise a strategy that is custom crafted to suit your needs.

Our firm would be glad to help if you are ready to take direct action. We offer no obligation consultations, and you can call us at 860-548-1000 or contact us electronically to set up an appointment.

 

 

  • Author
  • Recent Posts
Barry D. Horowitz, Estate Planning Attorney
Barry D. Horowitz, Estate Planning Attorney
Founding Partner and President at Nirenstein, Horowitz & Associates PC
Barry D. Horowitz is a founding partner and president of the law firm of Nirenstein, Horowitz & Associates, P.C. He received his diploma from the Loomis Chaffee School and his Bachelor of Arts from Bennington College, where he dual majored in philosophy and music.

Mr. Horowitz was awarded his Juris Doctor degree with honors from the University of Connecticut School of Law. While attending law school, Mr. Horowitz received the American Jurisprudence Award in Legal Ethics and the Nathan Burkan Award.

After graduation from law school, Mr. Horowitz continued his legal education at New York University School of Law where he received a Post Doctorate Law Degree in Taxation. He has also recently received a national achievement award.

Mr. Horowitz is admitted to practice before all the state courts in the State of Connecticut and the United States District Court.

Mr. Horowitz was selected for Super Lawyers in 2021, 2022 and 2023.
Barry D. Horowitz, Estate Planning Attorney
Latest posts by Barry D. Horowitz, Estate Planning Attorney (see all)
  • Legacy Planning In the Age of the Silver Tsunami - November 21, 2023
  • Estate Planning Neglect: Unraveling the Risks - November 2, 2023
  • When Is a Trust Preferable to a Will? - October 17, 2023
Share our Content:

Filed Under: Estate Planning Tagged With: buy-sell agreements, small business succession

Other Articles You May Find Useful

estate plan
Liquidation Could Be Part of Your Estate Plan
estate planning
The Right Time for Estate Planning Is Now
retirement planning and estate planning
Retirement Planning and Estate Planning Go Hand in Hand
small business succession planning
Small Business Succession Planning: Secure Your Legacy
trust
When Is a Trust Preferable to a Will?
irrevocable trust
Is an Irrevocable Trust Permanently Set in Stone?

Primary Sidebar

Nirenstein, Horowitz & Associates

Upcoming Seminars

Estate Planning Seminar

Date: December 5

Venue: Sheraton Hartford South Hotel, 100 Capital Boulevard, Rocky Hill, CT, 06067, United States

Estate Planning Seminar

Date: December 5

Venue: Sheraton Hartford South Hotel, 100 Capital Boulevard, Rocky Hill, CT, 06067, United States

See all Seminars

Follow Us

  • Facebook
  • Instagram
  • LinkedIn
  • RSS
  • Twitter
  • YouTube

TESTIMONIALS

Blog Subscription

Our blog gives you the most up-to-date estate planning news. Sign up today to receive our regular updates!

  • This field is for validation purposes and should be left unchanged.

WESTPORT OFFICE

8 Wright Street, Suite 107
Westport, CT 06880
Phone: (860) 548-1000
Fax: (860) 761-1070
preserveyourestate_sidbr_map

Somerset Square

200 Glastonbury Boulevard, Suite 202
Glastonbury, CT 06033-4418
Phone: (860) 548-1000
Fax: (860) 761-1070
preserveyourestate_sidbr1_map

Office Hours

Monday8:30 AM - 5:00 PM
Tuesday8:30 AM - 5:00 PM
Wednesday8:30 AM - 5:00 PM
Thursday8:30 AM - 5:00 PM
Friday8:30 AM - 5:00 PM

Footer

footer-logo
  • Facebook
  • Instagram
  • LinkedIn
  • RSS
  • Twitter
  • YouTube

The information on this website is for general information purposes only. Nothing on this or associated pages, documents, comments, answers, emails, or other communications should be taken as legal advice for any individual case or situation. The information on this website is not intended to create, and receipt or viewing of this information does not constitute, an attorney-client relationship.

Privacy Policy | Contact Us | Disclaimer | Site Map | Powered by American Academy of Estate Planning Attorneys

© 2023 American Academy of Estate Planning Attorneys, Inc.