We all love to compartmentalize. “This part of my life is in this box over here, and this part is in that box over there.” It makes life seem neater and easier. But that’s just an illusion because, in reality, every part of our lives are entangled with another part – like the big, messy ball of outdoor lights Clark Griswold hands his son, Rusty, in the classic movie National Lampoon’s Christmas Vacation.
Limited Liability Companies (LLCs) and buy-sell agreeements tend to be in one of those boxes: “Over here is my business or investment property.” But however the legal entity or contract was created, many folks don’t realize how entangled that entity or agreement is with their overall estate plan. And because of that they make costly mistakes.
In various cases, Florida courts have ruled that provisions in an LLC’s operating agreement regarding the disposition of the LLC member’s interest at his death overrode that LLC member’s Will, and that certain buy-sell provisions also overrode the Will. This was not always what the party intended or his family wanted.
If you’re a member of an LLC or a party to a buy-sell agreement, be sure to have your estate planning attorney review all of your business documents to make sure nothing in there will blow up your carefully drafted estate plan.
Give the Law Offices of Cynthia M. Clark, PLLC a call at 941-444-5958. We’ll help you untangle the messy parts of life.