Creative Ownership Transfer
The sole owner of a diversified contractor wanted to provide the manager of one of its major operation divisions with ownership in the company as a reward for past service. However, the owner wanted the ownership interest tied to the results of the one operating division this manager oversaw. In addition, the owner wanted to structure the ownership transfer as a tax-free transaction and to protect the entity's S-election.
While there were several “easy” solutions that would have met some of the owner's wishes, BKD proposed a solution that met all of the client's major objectives.
The result: a client who retained a highly successful key manager through a creative performance incentive strategy.
While there were several “easy” solutions that would have met some of the owner's wishes, BKD proposed a solution that met all of the client's major objectives.
The result: a client who retained a highly successful key manager through a creative performance incentive strategy.
Planning for the management and ownership succession is a complicated process that must consider the tax effects of alternative plans, gifting options, the structure and financing of buy/sell agreements, etc. These issues must be balanced with your personal objectives and family expectations and obligations.
BKD's approach to business succession is a comprehensive plan for “taking care of business” throughout the life cycle of your company. The cycle mirrors the business cycle: from start-up to growth to maturity, Our approach can help plan the evolution and growth of your company. Here are some of the ways we can help you with succession planning:
- Develop a contingency plan to cover problems resulting from an untimely death or disability including management succession planning.
- Develop a tax-advantaged estate plan
- Analyze various gifting options
- Analyze the financial impact on your business of various sale transactions
- Project the income it will take for you to enjoy a comfortable retirement and develop a plan to accumulate those funds
- Develop a plan for managing your exit strategy
