Probating A Business In Georgia

Melissa Breyer, Esq.
Last Updated: June 12, 2024

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Probating a business in Georgia is overwhelming.

There are a TON of moving pieces.

There’s a lot of opportunity to mess things up financially.

And you don’t want to be personally liable for financial mistakes.

This gives you an overview of what you need to do to handle it all.

What Needs To Go Through Probate?

A business needs to go through probate depending on how ownership is set up.

Either they are set up to automatically transfer ownership or not.

Business Structures That Need Probate

Sole Proprietorship: The business is the owner’s property and is a part of their estate.
Partnerships: Ones without clear agreements.
Corporations: Ones without transfer on death provisions.
LLCs: Ones without operating agreements.

Businesses That Avoid Probate

Partnerships: Transfer or buyout provisions in the partnership agreement can avoid probate.
Corporations: Shares with TOD provisions or held in trust bypass probate.
LLCs: Operating agreements outlining automatic transfer to other members or designated heirs.
Businesses with Trusts: The trust controls assets and directs their distributions.

The Probate Process With A Business

Here is how the probate process works with a business.

(Check out this Checklist For Probating A Business In Georgia.)

Determine Business Type

Identify how the business is set up:

Sole Proprietorship: Business assets are part of the personal estate.
Partnerships: Follow the partnership agreement for the next steps.
LLCs: Adhere to the operating agreement.
Corporations: Probate the shares and follow bylaws and shareholder agreements.

Gather Documents

Gather documents like:

the will
business agreements
financial statements
other legal papers

File The Petition For Probate

File the will at the Probate Court in the county the deceased lived in.

If there’s not a will, the estate gets split up per Georgia intestate laws.

Appoint Executor Or Administrator

The courts will appoint an:

Executor if there is a will
Administrator is there is not a will

Either way, this is the person who manages the estate and distributes it.

Inventory Business Assets

This person will have to put together a detailed inventory of business assets, like:

Tangible Assets: Physical items such as property, equipment, machinery, vehicles, inventory, and office supplies.
Intangible Assets: Non-physical items such as patents, trademarks, copyrights, goodwill, and customer lists.

The documents that you need to gather are:

Property Deeds and Titles: For real estate and vehicles.
Financial Statements: Balance sheets, income statements, and cash flow statements.
Invoices and Receipts: For equipment, inventory, and other purchases.
Contracts and Agreements: Leases, licensing agreements, and customer contracts.

Here is how to appraise the property:

Real Estate Appraisal: Hire a certified real estate appraiser.
Equipment Valuation: Use industry guides or hire a professional appraiser.
Inventory Valuation: Use current market prices or cost accounting methods.
Intangible Asset Valuation: Consult with financial experts to determine the value.

Our business appraisers handle this for you.

We will provide you with the detailed report the probate court needs.

Fill out the form on this page to get started.

Notify Creditors And Settle Debts

Notify the creditors of the deceased’s passing.

You may have to sell assets to pay off creditors of the estate.

Manage Business Operations

Depending on the business structure, the executor or administrator may need to:

keep the business running
manage employees
service clients

Transfer Or Liquidate Business Assets

Depending on the will and business operating agreements, you will have to:

transfer ownership of the business
sell the business
liquidate assets

MAKE SURE you are complying with:

legal requirements
the beneficiaries’ best interests

You don’t want to be legally liable for financial mistakes here.

We will take this off your plate so you avoid any litigation or liability.

Fill out the form on this page to talk to our team.

Distribute Remaining Assets

After settling debts, distribute the remaining assets to the beneficiaries.

Close The Estate

Put together the final accounting presentation.

Then, file it with the probate courts.

The judge will approve the accounting and close the estate.

Special Considerations For Probating A Business

Here are things that trip people up the most.

How To Value A Business

To value a business, here are the steps the executor should take:

Gather Documents: Balance sheets, income statements, and tax returns.
List Business Assets: Inventory tangible assets (real estate, equipment) and intangible assets (intellectual property, goodwill).
Identify Liabilities: Document all outstanding debts and financial obligations.
Hire Professionals: Hire a business appraiser to determine the business’ value.
Compile and Submit Report: Create a detailed report and give it to the courts.

Our probate lawyers have the experience needed to navigate this.

Fill out the form on this page to get help today.

Handling Business Debts

Here is how business debts get handled during probate.

It depends on if the business is a:

Separate Legal Entity (Corporation, LLC): The business is responsible for its debts, not the deceased’s estate. The operations pay the business debts.
Sole Proprietorship/Partnership: The owner’s business debts are personal liabilities and must be paid from the estate.

How To Transfer Ownership Of A Business

Transferring ownership of a business depends on ownership structures.

For Corporations and LLCs:

Determine the value of the shares you’re transferring.
Complete stock transfer forms (corporations) or membership interest assignments (LLCs).
Update the stock ledger or membership register.
Inform the registered agent, state business office, and regulatory bodies.

For Sole Proprietorships and Partnerships:

Decide how to transfer the business – sale, gift, or inheritance.
Get a professional valuation.
Prepare a document outlining terms, price, and conditions.
Complete a bill of sale and transfer forms.
File paperwork to update business licenses and registrations.
Change bank accounts and tax registrations.

Get Help From A Probate Lawyer

Are you overwhelmed by the process of probating a business?

Our Georgia probate attorneys handle everything for you.

We specialize in taking as much as possible off your plate so that you are not:

personally financially liable
accidentally breaking the law
filling out the paperwork wrong
not notifying or paying off creditors
dealing with disputes among family and partners

Fill out the form to take this off your plate.