.png)
by Denyve Boyle, CAP®, CFRE, MB
As an attorney, CPA, or financial advisor, you likely work with clients who own a family business. You may also recognize that strategic philanthropy can play a role in succession planning as clients prepare for an eventual exit. But how does that strategy take shape in a real client conversation?
The following case study illustrates a scenario similar to what you might encounter in your own practice.
When Mark and Elaine come into your office to update their estate and financial plans, retirement is only part of the future picture they’d like to discuss. At 66 and 64, they are financially secure—but the larger question looming in the background is the future of the family business. After three decades of ownership, they are beginning to explore a potential sale within the next few years.
The early part of the conversation feels familiar. You review income projections, portfolio sustainability, and how the company’s corporate structure could evolve to allow Mark and Elaine to step back from day-to-day operations. If you are their financial advisor or CPA, you may run projections, stress-test assumptions, and outline what taxes and retirement could look like after a liquidity event. If you are their estate planning attorney, you may review the company’s legal structure and contingency transition plans.
In any case, the numbers appear strong. A sale would more than support Mark and Elaine’s lifetime needs. As the conversation continues, however, a more nuanced question surfaces: what does succession look like not only operationally, but also for the family’s reputation and relationships?
“Our two adult children are not active in the business,” Mark explains. “A third-party sale is inevitable, and we are comfortable with that financially, but it’s a gut punch emotionally.” A concerned expression crosses Mark’s face, and he pauses before adding, “The company’s name carries a lot of weight in the community. For years, the business has been closely tied to our family’s identity and local impact. What happens to that identity if we sell?”
Elaine shares a different concern. “I really want our children to stay connected to our family after a liquidity event. For so many years, company events and trips have been where we’ve all gathered. I hate to think of that ‘glue’ disappearing in an instant.” Elaine says she has seen other families fracture after a business sale. “They barely see each other anymore,” she remarks.
This is where you introduce a broader planning lens. You acknowledge that a business sale is not only a financial event. It can be deeply personal and public at the same time. How the family prepares for that transition can influence both community relationships and family unity for years to come.
You suggest that philanthropy, structured intentionally before a sale, can help bridge this transition. One option is for Mark and Elaine to transfer shares of the business to a donor-advised fund at Community Foundation Tampa Bay, well before any potential transaction. When the business is eventually sold, a portion of the proceeds would then flow into the donor-advised fund.
The tax advantages of the transaction are meaningful. By donating a portion of closely held stock before a legally binding sale process begins, Mark and Elaine may qualify for an income tax deduction, subject to AGI limitations, based on the stock’s fair market value at the time of the gift. Later, when the business is sold, the proceeds attributable to the shares held by the donor-advised fund are generally not subject to capital gains tax.
Establishing a donor-advised fund before the sale also allows the family to begin defining a shared charitable mission while the business is still operating. You explain that tax efficiency is only one aspect of the strategy. Philanthropy can also provide continuity. Even if ownership changes, the family’s commitment to the community remains visible and active.
You recommend that Mark and Elaine invite the Community Foundation team to join the next meeting. While you remain responsible for facilitating the transaction and coordinating with other advisors, the Community Foundation’s philanthropic advisors can facilitate conversations that go beyond the corporate, legal, financial, and tax aspects, leading a dialogue focused on questions that will shape the family’s philanthropy plan, such as:
- What causes reflect the values that built the business?
- How should the family’s name be represented after the sale?
- What governance structure will guide the next generation’s involvement?
You also explain that the Community Foundation can host structured family meetings, provide community needs assessments, and introduce best practices for multigenerational philanthropy. Importantly, this gives the children a meaningful role before liquidity occurs. Rather than waiting for proceeds, they can begin working together to recommend grants, evaluate impact, and represent the family's values in the community.
In effect, philanthropy becomes a training ground for shared decision-making without the operational responsibilities of running a company.
Mark and Elaine love this suggestion. “Let’s do it,” Elaine says. “This makes a future sale feel less like an ending and more like a transition.”
Mark and Elaine’s situation is one of many examples of situations where a family business may eventually change hands. With thoughtful planning and a philanthropic structure developed in coordination with Community Foundation Tampa Bay, a family’s influence, values, and sense of connection can continue long after a business sale. If you would like to explore how charitable planning can support your clients through business transitions, the Community Foundation team welcomes the opportunity to work with you.
Denyve Boyle, CAP®, CFRE, MBA, is the Associate Vice President of Philanthropy at Community Foundation Tampa Bay. She is an experienced, highly motivated professional that inspires philanthropy throughout the community by educating and engaging individual donors, corporations, and professional advisors. She can be reached by phone at (813) 609-4868 or via email at dboyle@cftampabay.org.
.png)
.webp)
%20(1).webp)