When you own a business, your estate plan isn’t just about passing down personal assets—it’s about protecting what you’ve built and ensuring it doesn’t unravel without you. If you’re a business owner in New York City, smart estate planning means more than writing a will. It means legally separating your business from your personal estate, protecting your family’s future, and preparing for transitions long before they happen.
This guide is for NYC entrepreneurs, LLC owners, and S-corp shareholders who want to protect both their business and their family legacy. You’ll walk away with practical steps, legal insights, and the peace of mind that comes from knowing your legacy won’t be left to chance.
What’s the First Legal Step for Business Owners?
The first and most critical legal step is to make sure your business is legally separate from your personal assets. That means setting up a proper entity structure—whether that’s an LLC or S-corp—and having foundational documents like an operating agreement or shareholder agreement in place.
From there, your estate plan needs to reflect that structure. At The Village Law Firm, we help clients integrate their business into their estate plan through a business succession clause—something most DIY wills and even many traditional trusts overlook. Without this, your heirs may face court delays, family disputes, or even business shutdowns due to lack of legal authority.
Do Estate Planning Strategies Differ for LLCs and S-Corps?
Yes—and understanding the differences is crucial. While both LLCs and S-corps provide liability protection, the rules around ownership transfer and succession vary:
For LLCs:
- Review the operating agreement: Does it name a successor?
- Determine if interests can be transferred to a trust.
- Watch for clauses allowing members to block a transfer to heirs.
For S-Corps:
- Evaluate shareholder eligibility rules. Not all trusts qualify as S-corp shareholders.
- Consider using an Intentionally Defective Grantor Trust (IDGT) or Electing Small Business Trust (ESBT) to maintain S-corp status.
- Analyze voting rights and tax implications of the succession plan.
Because the legal and tax details differ, our team customizes every business owner’s plan based on their entity type, industry, and personal goals.
How Can Business Owners Protect Family Without Burdening Them?
We start by asking the foundational question:
Do you want your family to run the business—or simply benefit from it?
Not every child is eager to become the next CEO. And not every founder wants to force that path. That’s why many NYC entrepreneurs opt for a plan that separates ownership from management.
Here are a few structures we often recommend:
- Appointing a non-family operator to run the business while family members retain economic interest.
- Selling the business and placing proceeds into a family trust that supports generational wealth.
- Setting conditions on who can inherit ownership shares, to prevent internal conflicts or misaligned leadership.
Ultimately, a good plan reflects your values, protects your team and customers, and gives your family the security and clarity they deserve.
Don’t Forget the Personal Side
Too often, business owners plan extensively for their company, but neglect the personal aspects of estate planning. Your healthcare proxy, power of attorney, and guardianship designations matter just as much—especially if you have minor children or aging parents who rely on you.
In fact, these foundational legal documents are among the most common reasons estate plans fail. At The Village Law Firm, we provide holistic planning for high-achieving professionals who can’t afford to leave any detail undone.
Frequently Asked Questions
Q: What happens to my business if I die without a will in NYC?
A: Without a will or succession plan, your business interest becomes part of your estate and goes through probate. That means court oversight, possible delays, and potential ownership disputes—especially if heirs disagree or are underage.
Q: Can I leave my business to a minor child?
A: Technically, yes—but it’s not a good idea. Instead, we recommend placing ownership into a trust and naming a responsible trustee to manage it until the child reaches a suitable age. This prevents court intervention and protects the business’s value.
Q: What if I want to sell my business later—should I still plan for succession?
A: Absolutely. Until the business is sold, anything can happen. Having a transition plan ensures your business retains value even in unexpected circumstances. Plus, planning early can help optimize tax outcomes when you do sell.
Ready to Protect Your Business and Your Legacy?
If you’re a business owner in NYC and haven’t integrated your company into your estate plan, it’s time to act. Let The Village Law Firm help you create a legacy plan that works for your business, your family, and your future.
Schedule your complimentary call today.
