Planning for Closely Held Business Owners - 3 Advantages and Disadvantages of Business Succession Flashcards
1
Q
What are the advantages of business succession within a family?
A
- Business stays within family
2
Q
What are the disadvantages of business succession with an outside buyer?
A
3
Q
What is the related party attribution rules?
A
4
Q
What are the disadvantages of business succession within a family
A
- jealousy between siblings
- alot of restriction between the family
- one family member will be more active than the other members
- usually not possible to split ownership between siblings
5
Q
What are the related party attribution rules?
A
Like all businesses, the closely held business is impacted by technology, laws, the economy, competition, financial trends, and workforce issues. Additionally, the closely held business is impacted by family issues such as the family members’ health, skill level, interest level in the business, marital status, and particular personal goals.
