PUBLISHED ON: May 1, 2004
The transfer of a family business from one generation to the next raises many difficult business and estate planning questions. What will be the effect of a change of ownership (legal control) and management? Which children will participate in management and in what positions? If children who do not work in the business have an ownership interest then how will children who do work in the business reap their fair share of its success? On the other hand, if children who are not involved in the business receive no ownership interest then how will they otherwise receive their fair share of family wealth? Planning for the transfer must be done with great care in order to preserve family harmony as well as the viability of the business.