Passing family businesses to survivors can be complicated
Family-owned businesses face unique issues — succession planning, marriages and divorces, complicated relationships — as well as the routine issues that come with being self employed.
The death of a business owner creates real challenges for the surviving family, however. The newly widowed faces the most dramatic upheaval possible on the home front and often assumes the new responsibility of running the family business.
Sometimes though, those left behind just want to cash out. Now, however, new wills legislation planned for Alberta could make passing family businesses on to the next generation a bit more difficult.
The new law will give a deceased person's husband or wife the right to make a claim for division of property under the family law legislation — in other words, the same amount they would have been entitled to had they divorced.
The succession rules vary from province to province, of course. In Ontario, for instance, a surviving partner can elect either to claim their share of the matrimonial property or simply take whatever their spouse left to them in his or her will.
In Alberta, on the other hand, the new legislation will give surviving spouses the right to both.
This may cause new problems for Alberta farmers, ranchers and business people who have arranged for their children to inherit their business assets but left other property to their life partners.
Have you been caught up in conflict between a business and a surviving spouse? How were things resolved?
By Gordon Powers, MSN Money