Helping a Business Survive a Co-Owner's Death or Disability

Sidney Kess, JD, LLM, CPA, and Edward Mendlowitz, CPA/PFS, ABV

Co-owners of privately owned businesses often do not make a plan to assure business continuation upon their or their partner's death or disability, although it is an essential point of concern. One important way to ensure the continuity of a business is for the owners to execute a buy-sell agreement: a contract that provides for the sale of ownership in the business upon the occurrence of a specified event. This is often the death or disability of one of the owners, and may also provide for sale upon the retirement or exit of one of the parties. These are areas where a CPA financial planner can provide great assistance to small business owners.