We would like to thank our neighbors in Rancho Cordova for visiting our website. If you are looking for a licensed estate planning attorney in Sacramento County area, you have found a reliable local resource. Here at Northern California Center for Estate Planning and Elder Law, we take our commitment to our neighbors in Rancho Cordova seriously.
Rancho Cordova: An All-America City
Rancho Cordova is located in Sacramento County and is part of the Sacramento Metropolitan Area. With a population of more than 64,000, Rancho Cordova is the largest employment center in the Sacramento area welcoming more than 50,000 commuters. The city was named the All-America City Award winner in 2010.
The incorporation of the City of Rancho Cordova
The City of Rancho Cordova was first incorporated in 2003 after 20 years or more of advocacy for incorporation. It became the 478th city in California. It is a community rich with history such as the first 12 miles of railroad in California. Rancho Cordova is also home to a thriving military based and an aerospace company. The decision to incorporate was based on the desire to retain and improve the community’s identity and preserve the quality of life. It was also to promote an increase in representation and accessibility of the local government. Rancho Cordova wanted to have more substantial control over local land use, as well as planning and regulations. In this way, the community could increase the services available to Rancho Cordova residents.
Serving Our Neighbors in Rancho Cordova
If you are a sole proprietor, you know that your business assets are essentially your assets, as the business owner. For that reason, your business assets will be lumped together with your personal assets after your death, even if some assets are in the name of your business. If you owned non-liquid assets, such as property, vehicles, machinery, the fair market value of that property will also be included with your personal assets for federal estate tax purposes. This is an issue that your business planning attorney can help you address ahead of time in order to reduce or even eliminate those taxes.
Consider establishing limited liability entities
There are two business entities created specifically for the purpose of limiting personal liability for business owners: Limited Liability Companies (LLCs) and Limited Liability Partnerships (LLPs). Owners of these entities can elect to be taxed as “passes through” entities, which allows them to avoid double taxation. The flexibility of a limited liability entity also permits the business owners to assign income and losses in the most tax-friendly way possible.
Other business planning options for small businesses
Your business planning attorney can explain some of the other types of business structures available, as well as the advantages and disadvantages of each. By discussing your options with your business planning attorney, you can choose from different strategies that will maximize the growth of your assets throughout your lifetime and ensure proper distribution of those assets after your death.
The benefits of a business succession plan
Some clients actually intend for their businesses to be passed on to their heirs intact so their loved ones can continue the family business. If this is the case, you should specifically discuss a business succession plan with your business planning attorney. There will eventually come a time when you will be ready to retire from running the family business. However, resigning is not as easy as you may think – not if you want the business to continue running smoothly. You need to pass on the reins properly. That is where a business succession plan comes in. Although most business owners would prefer to pass on the management of the business to the next generation, less than 30% of owners actually have a succession plan in place.
Why you need a business succession plan
The principal goal of a business succession plan is to ensure a smooth transition of ownership and management. Without these two components, your continuation of your business is not assured. A proper succession plan can address the two most common issues that prevent family-owned businesses from surviving: inadequate tax planning and family disputes.
What you should include in your succession plan
Each business succession plan needs to address three key issues: ownership, management, and taxes. A common misconception is that ownership and management of a business are essentially the same, but they are not. For example, you can transfer ownership of your business to all four of your children, but typically only one child will be named to take over management of the company. The reality is not all of your children will be capable, or even interested, in managing the business or being active in its operation. Your plan should take all of this into consideration.
If you have questions regarding business succession or any other small business planning matters, please contact the experienced attorneys at the Northern California Center for Estate Planning and Elder Law for a consultation. You can contact us either online or by calling us at (916) 437-3500. We are here to help!