When most business owners think about estate planning, they’re usually focused on one thing: what happens to the business after they’re gone. And while planning for succession is essential, there’s another scenario that often gets overlooked—what happens if you’re still alive but unable to run your business?
Incapacity isn’t just about catastrophic accidents or permanent disability. It can be temporary. It can come in the form of a long recovery after surgery, a cancer diagnosis that takes you out of the office for months, or even an extended leave to take care of a family emergency. The bottom line is this: if you can’t be there, your business still needs to function.
The Real Risk of No Plan
As a business owner, you wear a lot of hats. You oversee operations, make the big decisions, manage key relationships, and keep the business financially afloat. So what happens when you suddenly can’t be in the office for an extended period?
Without a clear incapacity plan, the absence of leadership can create confusion—and fast. Employees might not know who’s in charge. Decisions could be delayed or made by the wrong people. Worse, family members involved in the business may assume they should step in, even if they’re not the best fit.
A lack of structure during your absence can lead to internal power struggles, operational breakdowns, and even financial loss.
What Incapacity Planning Looks Like
Incapacity planning is an extension of good estate planning. It’s about protecting your business during your lifetime—not just after you’re gone.
Here’s what a solid incapacity plan should include:
- A designated decision-maker: Someone who knows the business, commands respect, and can make tough calls when you’re unavailable.
- Clear communication: If your family works with you, set expectations early. Being related doesn’t automatically make someone the best person to lead.
- Legal authority: Make sure your chosen backup has the legal power to act on your behalf—this often includes creating a durable power of attorney or incorporating provisions into your business operating agreement.
- Operational systems: Document key processes, vendor contacts, passwords, and protocols. If you’re out, someone needs to step in seamlessly.
Why Family Isn’t Always the Best Fit
Many business owners assume a spouse, sibling, or child will take the reins if something happens. But that assumption can be risky. Family members may not have the right experience, temperament, or relationships to lead the business effectively. And assuming they’ll step up—or that others will accept them in the role—can cause unnecessary tension or confusion.
Choosing the right person means thinking about what your business actually needs to stay stable in your absence, not just who’s closest to you.
Build a Plan Before You Need One
At the end of the day, estate planning isn’t just about preparing for death—it’s about protecting what you’ve built during your lifetime. For business owners, that means thinking beyond succession and addressing incapacity head-on.
If you haven’t created a plan for who leads your business when you can’t, now is the time. We can help you identify the right person, create the necessary legal documents, and build a plan that protects your employees, your income, and your peace of mind.
A little planning today can keep your business strong—no matter what tomorrow brings. Let’s talk. Schedule a meeting with us today.
