Estate Planning In North Dakota

Accessibility


Transition Planning

Transition planning is planning the transfer of the ownership and management of a business to new owner(s). During transition planning, business owners develop a vision for transferring ownership and management of the business, as well as ownership of the business assets from the current owner(s) to a new owner(s). The transfer of ownership and management of a closely-owned business often occurs over time, rather than as one immediate transaction. The process of transferring ownership and management, the timing of the transfers and other details often are considered in developing a plan to transition a business from the current owner(s) to the new owner(s).
Asset ownership and business ownership
Owning the assets used in a business is NOT the same as owning the business. For example, a landowner who leases land to a farm business, owns the land (an asset used by the farm business) but does not own the farm business. This page explains the difference between asset ownership and business ownership, and how understanding the distinction clarifies the development of a transition plan.
Communication
Transitioning business ownership often extends over time and involves individuals with different perspectives, goals and interests. Open and regular communication is critical to achieving a successful business transition.
Role of Goals
Knowing what one wants to accomplish is essential to developing a transition plan. The use of goals in establishing a transition plan and the process of creating goals are addressed on this page.
Aligning Risk, Control and Profit
Business ownership is based on the risk assumed by each co-owner. Business ownership allows the owner to share control and earnings of the business. This page considers how to align risk exposure with the rewards of control and profit for accepting risk, especially as each of these vary while the business is being transitioned to new owners.
Business Organizations
Many business as they transition among owners will be co-owned. Co-owned business are assumed to be partnerships unless there is formal documentation indicating the legal form or structure. This page introduces basic forms of business co-ownership.
Creative Commons License
Feel free to use and share this content, but please do so under the conditions of our Creative Commons license and our Rules for Use. Thanks.