You might have heard of probate nightmares that remaining business owners, would-be successors and families face. These include long delays, huge expenses and difficult court battles. They are time-consuming, costly and a pain in the neck.   For example, they involve filing fees, lawyer fees and publication charges in terms of expenses.

But if you’d reflect and dig into their root causes, the problems lie in a bad estate plan. All of these chaotic situations could be avoided if the decedent leaves things in their proper places.  Check out the following for ways that business owners can avoid probate problems.

What’s a probate? It is a legal process or procedure that involves a probate court to oversee the deceased person’s properties. This court will appoint someone, who will ensure that properties are transferred to correct parties and that debts are paid.


One of the simplest ways to avoid a probate problem is to write a living trust, an alternative to the last will.  It outlines how your assets are distributed upon passing. In short, it places your properties in trust.

A trust manages these properties to benefit your beneficiaries.  This estate planning tool helps you avoid probate and the cost of probating a will because your assets and properties are distributed to the trust.

Wills and powers of attorney

If a business owner dies without a will, the probate law of the state will take over and manage the distribution of the properties to the proper parties. In order to probate a will, a property will be distributed according to it. However, take note that a will doesn’t skip or avoid a probate.

A will is a critical tool that can reduce the entire cost. Thus, you should have a will for your properties/assets that you cannot keep out of a probate estate.

Also, a will informs the probate court your last will on what you want to happen to your small business and other assets.

Seek a probate lawyer to create a will, and then follow the correct process to avoid a probate issue.

You should also have an executor to handle all these matters for you.  Also, you need to assign someone to manage your business while the probate is taking place.

In addition, you need a power of attorney in the event of disablement or incapacitation. This power of attorney assigns a trusted person to express the interest of your business to probate.

Real estate

In probate, real estate is also considered a business asset. A property is owned independently or is rented to your business. In this case, joint ownership that includes a detailed survivorship, a transfer on death deed or a life estate is essential. This joint ownership will eliminate or mitigate a probate issue should it arise.

Thus, you must establish a real estate joint ownership, such as a survivorship right to avoid a probate. With it, the title is transferred to the remaining owner if the owner passes.

Business continuation plan

Have a predetermined succession or continuation plan to avoid a probate issue.  This plan states who will hold the business’ ownership should you pass.

With it, you can also consider your family and business’ best interest. For example, you might want to assign another business partner to manage the business, while one of your family members owns it.

In this document, you also get to decide when this continuation plan starts. It can be before an owner’s death to give time for consultation between the owner and the successor/s.

A continuation business plan is made and known in advance. It allows the continuity of business operations, but its funding, such as a buy-sell agreement, is in place. However, the business cannot continue if the probate judge orders liquidizing the business assets to pay debts.

Thinking and acting ahead

Avoid possible probate issues with an estate plan set up. Consider a trust, a will, a power of attorney, a joint ownership of real estate and/or a business continuation plan.  These tools can help your successors, remaining business partners and family members avoid the headaches and nightmares of a tedious probate process. Finally, consider seeking a specialist lawyer to help you get through this difficult estate planning stage.

Mike Johnson is a creative content marketer at Manshoory Law Group, APC. He has always had a special interest in the sphere of Law and Human Rights. Dedicating a lot of his free time to understanding the small details and specifics of these fields, Douglas enjoys exploring and analyzing them in his articles. His main goal is to make this sometimes complicated information available and transparent for everyone.

Document stock photo by Vitalii Vodolazskyi/Shutterstock