Business Exit Planning: Protect Your Legacy & Minimize Estate Tax in MA

Planning is essential for a business owner. Whether preparing for retirement, unexpected events, or ensuring continuity of management, having an exit strategy is critical to protecting the business you have built and securing you and your business’ legacy.

Without a proper plan, your business could face financial risks, operational disruptions, and tax burdens. For example, if the sole business owner passes away without a plan, their family may struggle to access accounts, leading to operational chaos, delayed wages for their employees, and a loss of reputation. Similarly, incapacity without a contingency plan can disrupt income, inventory, and customer satisfaction. 

A comprehensive estate plan should include essential documents such as a Last Will and Testament, Revocable Living Trust, Durable Power of Attorney, and Health Care Proxy. These tools ensure your wishes are carried out and your business remains protected in the event of the business owner’s incapacity or death.

Additionally, tax planning is essential. In Massachusetts, one of the most expensive states to live in, estates valued over $2 million are subject to estate taxes of up to 16%. With such a low threshold, many estates exceed this limit, making proactive planning critical to minimizing tax burdens. Federally, estates above $13.61 million may face rates up to 40%. With federal exemptions likely to decrease in 2025 through the Sunset Act, proactive planning is more important than ever to minimize liabilities and preserve wealth.

Business succession planning paired with tools such as Key Person Insurance can protect your equity and provide stability during transitions. By taking these steps, you can ensure your business thrives, even when facing unexpected challenges.

Don’t leave your business to chance—start planning today to secure your family’s future and protect the business you’ve worked so hard to build. Request a consultation now to learn more.