Entity questions...

[Alfred Bell]

I will be doing residential rehab/resells. I now have an equity partner. He puts up the capital, I do all the work, we split the profits 50/50.

I operate through my single owner S-Corp. My equity partner will operate out of his living trust. On each project, title will be vested in both our entities as equal owners.

We need to ensure that if either of us become incapacitated or dies mid a project that it doesn't prevent the project from being completed, capital returned, profits taken, etc.

This is two questions: what would be the simplest way to do this for both these entities?

For my S Corp: could I just draw up a resolution for my corp appointing my wife as a non-salaried director or some such. Then if anything happened to me she would be able to take my place, sign docs, etc. to facilitate the completion of rehab and sale of the property. If not, what would be a better idea?

For my equity partners trust: all he would need to do is appoint a successor trustee and that person would have the authority to facilitate the completion and sale of any project? If not, what would be the better idea?

Thanks in advance,
Alfred

[Adam Tracy]

You may wish to form an LLC, having the scorp and trust as members. The LLC could pro bide for a manager and successor manager that could ensure the project is completed.