In our last blog post, we discussed funding a buy-sell agreement with life insurance. Now we will discuss the benefits of the buy-sell agreements.
- Orderly transfer: a buy-sell agreement provides for the orderly transfer of your business, ensuring it is not sold to outsiders who may force liquidation of the business.
- Fair price: the buyers and sellers can agree to a fair price now, rather than waiting until urgent circumstances potentially reduce the asking price.
- Peace of mind: business succession planning combined with the guarantee of life insurance can provide you with peace of ind.
- Stepped-up basis: surviving business owners receive a stepped-up tax basis when purchasing ownership shares from the deceased owner's estate in a cross-purchase arrangement.
- Variations available: variations on the standard buy-sell arrangement, including the LLC's buy-sell, trusted buy-sell, and wait-and-see-buy-sell trusted buy-sell, and wait-and-see buy-sell, are available in certain situations.
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