Trust Planning for Business Owners

Schedule a Consultation

You built your business from the ground up. You put in the long hours, made the hard calls, and created something worth protecting. But have you thought about what happens to your business when you’re no longer around to run it? For Atlanta business owners, trust planning is one of the most powerful tools available to protect your company, your family, and your legacy. At Slowik Estate Planning, located in Atlanta, Georgia, we work with business owners to create trust plans that are built around your specific goals and the laws that govern them.

Table of Contents

Why Trust Planning Matters for Atlanta Business Owners

Most business owners spend years building their companies. They think about payroll, growth, and customers. What often gets overlooked is the question of what happens to the business if the owner becomes incapacitated or passes away. Without a solid plan in place, your business could end up in probate court, get sold off to pay taxes, or fall apart because no one knows what to do next. That is a real risk, and it happens more often than most people expect.

A trust gives you a legal structure to hold and transfer your business interests outside of probate. Under the Revised Georgia Trust Code of 2010, found at O.C.G.A. Title 53, Chapter 12, Georgia law provides a strong framework for creating and administering trusts. The Revised Georgia Trust Code’s provisions apply to any trust irrespective of the date the trust was created, with two exceptions: to the extent it would impair vested rights, and except as otherwise provided by law. That means trusts created today are governed by a well-developed body of law that gives you flexibility and protection.

Georgia does not have a state estate tax. As a result, when passing assets on, you won’t owe Georgia estate taxes. That is good news for Georgia business owners. But federal estate taxes are still a real concern for those with larger estates. As of January 1, 2026, the federal gift and estate tax exclusion amount, as well as the exemption from generation-skipping transfer tax, have increased to $15,000,000 per person, which is a combined $30,000,000 for a married couple. Even with that higher threshold, a growing business can push your estate well past those limits over time. Planning now is the smart move.

The right trust plan keeps your business out of probate, reduces tax exposure, and ensures a smooth handoff to the people you choose. Working with an estate planning attorney in Atlanta who understands both Georgia trust law and the needs of business owners is the first step toward building a plan that actually works.

Types of Trusts That Work Well for Business Owners

Not every trust is the right fit for every business owner. The type of trust you use depends on your goals, your business structure, and how much control you want to keep. There are several trust structures that work well for Atlanta business owners, and understanding the basics of each one helps you have a more productive conversation with your attorney.

A revocable living trust is the most common starting point. You transfer your business interests into the trust, name yourself as trustee, and keep full control during your lifetime. When you pass away, a successor trustee steps in and manages or distributes the business according to your instructions. This avoids probate entirely. Under O.C.G.A. § 53-12-40 through § 53-12-45, Georgia law allows a settlor to revoke or modify a revocable trust at any time, which means you are never locked in.

An irrevocable trust is a different animal. Once you transfer assets into it, you generally give up direct control. But that trade-off comes with significant benefits. In practice, it means making lifetime gifts to irrevocable trusts that are designed to transfer assets to your loved ones as tax efficiently as possible. For business owners with appreciating assets, this can be a powerful way to remove future growth from your taxable estate.

Spousal Lifetime Access Trusts (SLATs), irrevocable life insurance trusts, and dynasty trusts can help preserve wealth across generations while providing asset protection and tax efficiency. A dynasty trust, for example, allows you to pass your business interests down through multiple generations without triggering estate taxes at each generational transfer. The generation-skipping transfer tax exemption, which applies to transfers to grandchildren and other “skip” persons, also rises to $15 million. That alignment makes multigenerational planning more accessible than ever for Georgia business owners.

Georgia law also recognizes spendthrift trusts under O.C.G.A. §§ 53-12-80 through 53-12-83. A “spendthrift provision” means a provision in a trust instrument that prohibits transfers of a beneficiary’s interest in the income or principal or both. This is a useful tool if you are concerned about protecting business assets from a beneficiary’s creditors or poor financial decisions down the road.

Business Succession Planning and Your Trust

What happens to your business when you are gone? That is the central question of business succession planning. A trust is often the backbone of a well-designed succession plan. It gives you a way to spell out exactly who gets what, who runs what, and when the transition happens. Without that structure, your family and business partners may be left guessing, or worse, fighting in court.

Think about this scenario (for illustration purposes only): you own a profitable Atlanta construction company. You have two adult children. One works in the business every day. The other has no interest in it. If you die without a plan, both children may inherit equal shares of the business, creating a conflict that could destroy what you built. A trust lets you address that problem directly. You can leave the business to the child who runs it, and provide other assets to the other child, all through clear trust instructions.

If your business makes up a significant portion of your estate, you’ll want to ensure it transitions smoothly to the next generation. A good business succession plan prevents taxes taking a huge cut of what you’ve worked hard to build. This is especially true for business owners whose wealth is tied up in illiquid assets. If your money is tied up in things that aren’t easy to sell quickly, like real estate, stock investments, or business interests, your loved ones might be forced to sell at a loss to pay the estate tax and other expenses.

An irrevocable life insurance trust, or ILIT, can also be paired with your succession plan. The trust (not you) owns the policy, so the life insurance proceeds are not included in your taxable estate. This preserves more of your wealth for your family. The proceeds can be used to pay estate taxes or buy out a co-owner’s share of the business, keeping the company intact and operational. Proper trust administration is critical to making sure these plans work the way they are supposed to when the time comes.

Tax Considerations for Business Owners Using Trusts

Taxes are a big part of why business owners use trusts in the first place. The federal tax rules around trusts are detailed, and getting them wrong can cost your family a significant amount of money. Understanding the basics helps you ask the right questions when you sit down with your attorney.

One key issue involves the tax treatment of grantor trusts. Under Internal Revenue Code § 671, when a grantor retains certain powers over a trust, the trust’s income and deductions are reported on the grantor’s personal tax return. This can be a useful planning tool. However, it also has an important implication for asset basis. Under IRS Revenue Ruling 2023-2, if you transfer assets into an irrevocable trust as a completed gift for gift tax purposes, and those assets are not included in your gross estate at death, the assets do not receive a stepped-up basis at your death under IRC § 1014. In plain terms, your heirs may inherit those assets at your original purchase price, not the current market value, which could mean higher capital gains taxes when they eventually sell.

This is a critical distinction for business owners who are considering using irrevocable grantor trusts to transfer business interests. The tax savings on one end may create a different tax cost on the other. Capital gains tax implications should be considered when transferring appreciated assets. The step-up in basis at death can eliminate capital gains tax for heirs, but gifting during life may forgo this benefit. Your attorney and your accountant need to work together on this analysis.

For 2026, the federal gift tax annual exclusion amount remains at $19,000. The annual exclusion is the amount an individual can gift per recipient per calendar year without using any lifetime exclusion amounts or paying gift tax. Business owners can use this annual exclusion to gradually transfer minority interests in their company to family members or a trust, reducing the taxable estate over time without using the lifetime exemption. The highest federal estate tax, gift tax and GST tax rate remains at 40% for 2026. That rate makes proactive planning worth every bit of effort.

Working with an Atlanta estate planning lawyer who understands both the Georgia trust code and federal tax law gives you a real advantage when it comes to building a tax-efficient plan for your business and your family.

Protecting Your Business and Your Family Through Trust Administration

Creating a trust is only part of the job. How that trust is managed over time, and after your death, matters just as much as how it was set up. Poor administration can undo even the best-written trust document. That is why it is important to choose the right trustee, keep the trust properly funded, and understand what Georgia law requires of a trustee.

Under O.C.G.A. § 53-12-340, Georgia trustees are held to a prudent investor standard. The provisions of this statute were revised to more closely follow those in the Uniform Prudent Investor Act (UPIA). As modified by the 2021 Amendments, the general rule of O.C.G.A. § 53-12-340 now provides that a trustee shall invest and manage trust assets as a prudent investor would by considering the purposes, provisions, distribution requirements. For a trust that holds business interests, this means the trustee must think carefully about how those interests are managed and whether they align with the needs of the trust beneficiaries.

Georgia also gives trustees broad powers to act on behalf of the trust. Under O.C.G.A. § 53-12-261, a trustee has the power to make, modify, and execute contracts and other instruments as the trustee deems advisable. This is important for business trusts because the trustee may need to sign contracts, manage employees, or even sell the business if that is what the trust directs.

The trustee may present a certification of trust to any person other than a beneficiary in lieu of providing a copy of the trust instrument to establish the existence of the trust provisions. This is a practical tool that allows business dealings to move forward without exposing the full contents of the trust document to third parties, like banks, buyers, or vendors.

It is also worth noting that trust planning is not just for business assets. Many of our clients at Slowik Estate Planning also plan for personal property, retirement accounts, and even their pets. Georgia law allows for creative planning tools like pet guardianships to ensure that every member of your family, including the four-legged ones, is taken care of. A comprehensive trust plan looks at the full picture of your life and your assets.

If you are a business owner in Atlanta, Georgia, and you want to protect what you have built, contact Slowik Estate Planning today. Our office is located in Atlanta, Georgia, and we are ready to help you put a plan in place that works for your business, your family, and your future. Reach out to us to schedule a consultation.

FAQs About Trust Planning for Business Owners in Atlanta, Georgia

Does Georgia have its own estate tax that affects business owners?

No. Georgia does not impose a state estate tax. However, Georgia business owners are still subject to federal estate tax rules. As of January 1, 2026, the federal estate and gift tax exemption is $15 million per person, or $30 million for a married couple. The federal estate tax rate on amounts above that exemption is 40%. For business owners with growing companies, the value of the business alone can push an estate above that threshold over time, which is why trust planning is so important.

What type of trust is best for a small business owner in Atlanta?

There is no single best answer because the right trust depends on your goals. A revocable living trust works well for avoiding probate and maintaining control during your lifetime. An irrevocable trust, such as an intentionally defective grantor trust or a dynasty trust, works better for reducing estate taxes and protecting assets from creditors. Many business owners use a combination of trust structures. An estate planning attorney at Slowik Estate Planning can review your specific situation and recommend the approach that fits your business and your family.

What is the stepped-up basis rule, and why does it matter for my business trust?

Under IRC § 1014, when someone inherits property from a deceased person, the tax basis of that property is generally adjusted to its fair market value at the date of death. This can eliminate capital gains taxes on appreciation that occurred during the owner’s lifetime. However, under IRS Revenue Ruling 2023-2, assets transferred to an irrevocable trust as a completed gift, and not included in your gross estate, do not receive this step-up in basis at death. For business owners with highly appreciated assets, this is a critical planning consideration that requires careful coordination between your estate planning attorney and your accountant.

Can a trust protect my business from creditors after I pass away?

Yes, certain types of trusts can provide meaningful creditor protection for your business interests and for the beneficiaries who receive them. Georgia law under O.C.G.A. §§ 53-12-80 through 53-12-83 allows for spendthrift provisions in a trust, which can prevent a beneficiary’s creditors from reaching trust assets before they are distributed. This is particularly useful if you are concerned about protecting your business legacy from a beneficiary’s financial problems or legal judgments. The level of protection depends on how the trust is structured, so working with a qualified attorney is essential.

How does trust administration work after a business owner passes away?

After a business owner passes away, the successor trustee named in the trust document steps in to manage and distribute the trust assets according to the trust’s terms. In Georgia, trustees are held to a prudent investor standard under O.C.G.A. § 53-12-340, meaning they must manage the assets, including any business interests, with care and in the best interest of the beneficiaries. The trustee may need to manage the business, sell it, or transfer ownership to the named beneficiaries. Having professional guidance during trust administration helps ensure that everything is handled correctly and in compliance with Georgia law. Slowik Estate Planning can assist with trust administration for Atlanta-area families.

More Resources About Trusts for Business Owners

Services

All Services

Testimonials

Jake is a person who really cares about his work. Can't recommend him enough and definitely telling my friends and family about his services.

- Catherine B.