Cava Faulkner

When running a business, it’s easy to give estate planning less priority than other matters. After all, if you’re facing challenges meeting next month’s payroll or your growth path over the immediate term,  concerns over your potential incapacity or death can seem far less pressing.

But the reality is considering what would happen to your business in the event of your incapacity or when you die is one of the most valuable things you can do for your business when it’s done right. Though estate planning and business planning may seem like two separate tasks, they’re actually inexorably linked. And given that your business is likely your most valuable asset, estate planning is vital not only for your company’s continued success, but also for your family’s future well being.

Without a proper estate plan, your staff, clients, and family could face dire consequences if something should happen to you. Yet these dangers can be fairly easily mitigated using a few basic planning tools.

To demonstrate, here are three potential problems your business is likely to encounter due to poor planning, along with three corresponding solutions:

If you only have a will in place, your estate—including your business assets—must go through when you die.

Lots of people think a will is all they need to protect their assets. But a will alone is insufficient to protect your company in the event of your death. If you only have a will, upon your incapacity or death, your family and business will be stuck in court.

During, the court oversees your will’s administration to ensure your assets (including your business) are distributed according to your wishes. However, often takes months to complete and can be extremely costly for your heirs—both of which can seriously disrupt your business operations and even lead to your company’s ruin. And perhaps worst of all, is a public process, leaving your business affairs open to whoever wants to know what’s going on.

On top of all that, while your family and/or team may know how to run your company without you, they might be unable to access crucial assets, such as financial accounts, until is concluded. Moreover, even if they can access all of the needed assets, the legal fees required for them to navigate can quickly deplete your company’s coffers.

And this is all assuming your will isn’t disputed during, which is also a real possibility, especially with a highly profitable business at stake. If your heirs disagree about whom you name to control your business and/or how the business assets should be divided, a vicious court battle can ensue and drag on for years, dividing your family and crippling your company.

Solution: You can avoid probate by placing your business in a living trust. A trust is not required to go through, and it transfers your assets immediately upon your death. Trusts also protect your business from creditors and lawsuits, who might go after your company with you out of the picture. Plus, trusts remain totally private.

If you become incapacitated and haven’t legally named someone to manage your business assets, the court will pick someone for you.

Another issue with a will is that it only goes into effect when you die and offers no protection for your business if you’re incapacitated by accident or illness. With just a will—or no planning at all—the court will appoint a “financial guardian,” sometimes called a conservator, to assume control of the company until you return to capacity.

Whether the guardian is a family member, employee, or outside professional, it’s highly unlikely that they’ll run the business exactly how you would, and this can lead to major disruptions. Not to mention, having a court-chosen guardian managing your business affairs can cause major conflicts and strife within both your team and family members, particularly if you’re out for a lengthy period.

Solution: One planning tool that can prevent this is durable power of attorney. Durable power of attorney allows you to name the person you would want to run your business if you’re ever unable to do so yourself. If you’re ever sidelined by illness or injury, this person will be granted immediate authority to handle your business affairs, such as managing payroll, signing documents, and making financial decisions.

 If you name a family member to run your company after your death and don’t offer them a detailed plan, your business can be wrecked by just a few bad decisions.

There are countless horror stories of family members assuming control of multi-million-dollar family businesses and running things into the ground in just a short span of time. And if such massive fortunes can be squandered so easily, it’s highly doubtful that smaller operations like yours will fare much better.

Even if your successor doesn’t destroy the company, he or she can cause serious conflicts among your staff, clients, and family simply by managing the business radically differently than you. Given this, simply naming a successor to take the reins in your absence is not enough.

Solution: A comprehensive business succession plan can help ensure your company doesn’t fall apart when you pass on. Beyond simply naming a successor, such plans provide stability and security by allowing you to lay out detailed instructions for how the company should be run. From specifying how ownership should be transferred and providing rules for compensation and promotions to establishing dispute resolution procedures, an effective succession plan can provide the new owner with a roadmap for your company’s continued success.

If you haven’t taken the time to put proper estate planning in place, your business is missing one of its most essential components. Consult with us so we can help you find the planning strategies best suited for your particular operation. Putting an effective estate plan in place can ensure the company and wealth you’ve worked so hard to build will survive—and thrive—no matter what happens.

We offer a complete spectrum of legal services for business owners and can help you make the wisest choices on how to deal with your business throughout life and in the event of your death. We also offer you a LIFT Your Life And Business Planning Session, which includes a review of all the legal, insurance, financial, and tax systems you need for your business. Schedule online today.

There’s currently more than 1,300 different forms of cryptocurrency like Bitcoin traveling through cyberspace, with a total value of more than $575 billion. While some people buy and hold crypto as an investment opportunity, many consumers use it just like other forms of currency—to purchase good and services.

From lower fees, enhanced security, and the elimination of chargebacks and payment disputes, there are numerous benefits to accepting cryptocurrency in your business. But perhaps the biggest benefit is the potential growth of your customer base and bottom line.

Indeed, with more and more companies accepting digital currency every day, it’s only a matter of time before this payment option becomes the rule, rather than the exception. Best of all, the technology that allows businesses to accept crypto now makes it just as easy—if not easier—to accept as it is to accept credit cards.

If you’re interested in capitalizing on this booming new payment method, you can get started accepting cryptocurrency by following these three steps:

You’ll first need to set up a merchant wallet account. A wallet account works like email, only instead of sending messages, it’s a digital address where customers send their money.

Merchant wallets can be set up in minutes though payment-processing companies like Coinbase, CoinGate, and BitPay. These digital exchanges automatically convert crypto into your base currency at the exchange rate that existed at the time the money was sent. From there, the funds can be transferred to your bank accounts.

Your wallet’s address, or public key, is a unique, 26-35 alphanumeric-character string, along with an associated Quick Response (QR) Code. The QR code allows customers to simply scan a computer-generated graphic with their smartphone to send money, rather than typing out the full address.

Your wallet also comes with a private key, which is another unique string of characters that basically works as your password to access your wallet. Be certain this key is stored securely and never lost, because if it is, all of your money will be gone, and there’s no way to recover it.

Some wallets only accept specific forms of cryptocurrency like Bitcoin, so if you want customers to be able to use more than one form, be sure you select a wallet that allows for that.

After you’ve set up a merchant wallet, you’ll want to integrate payment options into your points of sale (POS). Wallets can be used with nearly every different type of POS system, such as smartphones, payment terminals, online shopping carts, as well as paper and digital invoices.

Payment processors typically charge either a percentage (many just 1%) or a small monthly fee to process these transactions, which include taking the payment, exchanging it from crypto to base currency, and transferring it to your bank. These fees are generally much cheaper than those charged for using credit cards.

Here are a few of the most popular ways for businesses to accept crypto:

• Person-to-person: The easiest way to accept cryptocurrency payments is person-to-person (P2P). Using a mobile app that comes with your wallet, the customer scans your QR Code with their phone or tablet, and the money is sent to from their wallet to yours. In this way, even your neighborhood lemonade stand can take digital currency.
• POS systems: If you’re looking for a more robust solution, several options exist for streamlining the process of accepting crypto payments through your POS. Some companies, like Coinkite and Revel, offer their own payment terminals similar to those used for credit and debit-card payments. Others, like Bitpay, offer apps that can be integrated into existing POS devices like the SoftTouch POS System. Some of the more advanced systems even offer the ability to take crypto-based debit cards and serve as a crypto ATM.
• Online payment platforms: If you have an online business, there are a number of payment gateways that let you easily accept cryptocurrency payments through your website. In fact, some popular e-commerce platforms like Shopify and WordPress offer simple plugins that let you quickly integrate crypto into your existing online shopping cart. With most wallet accounts, you can even accept digital currency via online payment platforms like PayPal or Stripe.

While payment processors provide you with tools and reports for accepting and tracking crypto payments, you’ll likely want to integrate these transactions into your existing accounting systems as well. Some software providers like QuickBooks have apps for quickly integrating crypto payments, and most merchant wallet accounts include instructions for manually importing these transactions into other systems with minimal hassle.

As with any other major development of this nature, there are several legal, tax, and financial issues you should be aware of when accepting cryptocurrency in your business. These issues shouldn’t deter you from take advantage of this new opportunity, but because crypto is fairly new and largely unregulated, you should definitely consult with us to ensure you have all of your bases covered.

We offer a complete spectrum of legal services for business owners and can help you make the wisest choices on how to deal with your business throughout life and in the event of your death. We also offer you a LIFT Your Life And Business Planning Session, which includes a review of all the legal, insurance, financial, and tax systems you need for your business. Schedule online today.

While estate planning is probably one of the last things your teenage kids are thinking about, given the dire threat coronavirus represents, when they turn 18, it should be their (and your) number-one priority. Here’s why: At 18, they become legal adults in the eyes of the law, so you no longer have the authority to make decisions regarding their healthcare, nor will you have access to their financial accounts if something happens to them.

With you no longer in charge, your young adult would be extremely vulnerable in the event they become incapacitated by COVID-19 or another malady and lose their ability to make decisions about their own medical care. Seeing that putting a plan in place could literally save their lives, if your kids are already 18 or about to hit that milestone, it’s crucial that you discuss and have them sign the following documents.

Medical power of attorney is an advance directive that allows your child to grant you (or someone else) the legal authority to make healthcare decisions on their behalf in the event they become incapacitated and are unable to make decisions for themselves.

For example, medical power of attorney would allow you to make decisions about your child’s medical treatment if he or she is in a car accident or is hospitalized with COVID-19.

Without medical power of attorney in place, if your child has a serious illness or injury that requires hospitalization and you need access to their medical records to make decisions about their treatment, you’d have to petition the court to become their legal guardian. While a parent is typically the court’s first choice for guardian, the guardianship process can be both slow and expensive.

And due to HIPAA laws, once your child becomes 18, no one—even parents—is legally authorized to access his or her medical records without prior written permission. But a properly drafted medical power of attorney will include a signed HIPAA authorization, so you can immediately access their medical records to make informed decisions about their healthcare.

While medical power of attorney allows you to make healthcare decisions on your child’s behalf during their incapacity, a living will is an advance directive that provides specific guidance about how your child’s medical decisions should be made, particularly at the end of life.

For example, a living will allows your child to let you know if and when they want life support removed should they ever require it. In addition to documenting how your child wants their medical care managed, a living will can also include instructions about who should be able to visit them in the hospital and even what kind of food they should be fed.

This is especially vital if your child has specific dietary preferences. For example, if he or she is a vegan, vegetarian, gluten-free, or takes specific supplements, these things should be noted in their living will. It’s also important if you don’t know all of their friends or who they would want to be part of their medical decision-making should they become unable to make decisions for themself.

Additionally, remember to speak with your child about the unique medical scenarios related to COVID-19, particularly in regards to intubation, ventilators, and experimental medications. How such treatment options can be addressed in a living will can be found in our previous post: COVID-19 Highlights Critical Need for Advance Healthcare Directives.

Should your child become incapacitated, you may also need the ability to access and manage their finances, and this requires your child to grant you durable financial power of attorney.

Durable financial power of attorney gives you the authority to manage their financial and legal matters, such as paying their tuition, applying for student loans, managing their bank accounts, and collecting government benefits. Without this document, you’ll have to petition the court for such authority.

As parents, it’s normal to experience anxiety as your child individuates and becomes an adult, and with the pandemic still raging, these fears have undoubtedly intensified. While you can’t totally prevent your child from an unforeseen illness or injury, with us as your Personal Family Lawyer®, you can at least rest assured that if your child ever does need your help, you’ll have the legal authority to provide it. Contact us today to get started.

Proper estate planning can keep your family out of conflict, out of court, and out of the public eye. If you’re ready to create a comprehensive estate plan, contact us to schedule your Family Wealth Planning Session. Even if you already have a plan in place, we will review it and help you bring it up to date to avoid heartache for your family. Schedule online today.

On October 15th, nearly two months after the death of Black Panther star Chadwick Boseman, his wife, Taylor Simone Ledward, filed documents with the Los Angeles court seeking to be named administrator of his estate. Earlier this year, Boseman and Ledward were married, and the marriage gives Ledward the right to any assets held in Boseman’s name at his death.

Boseman died at age 43 on August 28th following a four-year battle with colon cancer, and based on the court documents, it seems the young actor died without a will. While Boseman’s failure to create a will is surprising, he’s far from the first celebrity to do so. In fact, numerous big-name stars—Aretha Franklin, Prince, and Jimi Hedrix—all made the same mistake.

What makes Boseman’s story somewhat unique from the others is that it seems likely the young actor put some estate planning tools in place, but it’s possible he didn’t quite finish the job. Based on the number of hit films he starred in and how much he earned for those films, several sources have noted that Boseman’s assets at the time of his death should have been worth far more than the approximately $939,000 listed in court documents.

So what happened to the rest of Bosman’s wealth? Seeing that his death wasn’t a surprise, some commentators have suggested that the bulk of Boseman’s assets passed through private trusts. But if that’s the case, why didn’t he also have a will, which would almost always be created alongside trusts?

Last week in part one we discussed a few potential explanations for this apparent blind spot in Boseman’s estate plan, and how the young actor might have prevented the situation by creating a pour-over will to be used as a backup to any trusts he had put in place. Here in part two, we’ll focus on another critical component of Boseman’s estate plan—incapacity planning.

While it was critical for Boseman to create planning vehicles to ensure the proper distribution of his assets upon his death, that’s just part of the overall planning he needed. The young actor also needed to plan for his potential incapacity—and given that he had cancer, the need for comprehensive incapacity planning would have been exponentially vital.

Regardless of his age or health condition, Boseman, like all adults over 18 years old, should have three essential planning documents in place to protect against potential incapacity from illness or injury. These include a medical power of attorney, living will, and durable financial power of attorney.

Should you become incapacitated and unable to handle your own affairs, these planning tools would give the individuals of your choice the immediate authority to make your medical, financial, and legal decisions, without the need for court intervention. If prepared properly, these documents can even allow your family to engage in planning that would support your eligibility for government healthcare benefits support, if needed. Finally, such documents would also provide clear guidance about how your medical care and treatment should be carried out, particularly at end-of-life.

If you were to become incapacitated without such planning tools in place, your family would have to destitute your estate before you could claim governmental support for your medical care. Your loved ones would also have to petition the court to appoint a guardian or conservator to manage your affairs, which can be extremely costly, time consuming, and even traumatic. For an in-depth look at some of the consequences this can entail, read our previous post, The Real Cost To Your Family: Not Planning for Incapacity.

Seeing that Boseman was suffering from end-stage colon cancer, such planning tools for incapacity would have been an absolutely critical part of his plan. And while we don’t know for sure if he had such documents in place, given that he died peacefully at home surrounded by his friends and loved ones, it seems more than likely that he did.

As Boseman’s death illustrates, even superheroes need to plan for the future. Death and illness can strike any of us at any time. And regardless of how much money you have, you need a comprehensive estate plan in place, not only to protect and pass on your material assets to your loved ones when you die, but also to ensure you’ll be properly cared for in the event of your incapacity from illness or injury.