The Small Business Administration estimates that in the next decade or so, approximately 70% of privately-owned businesses (and their IP) will change ownership. Although this expected wealth transfer translates to a cool $10 trillion, less than 30% of the affected businesses and individuals are prepared for the change with written succession plans and contingencies. Business owners may lack the time or emotional fortitude to face the notion of retirement or an unexpected need to hand over the reins to their business. However, a succession plan – whether it involves the next generation of a family business, an employee manager or management team, or an outside purchaser – is the best way to facilitate a successful transition of the business and its continued viability, not to mention a return on the investment of the current owner(s).One key element to any good succession plan is determining and monitoring the value of the business. Accounting professionals and valuation experts can help you establish this value, based on cash flow and liquid assets, profits, taxes, liabilities, fixed assets, such as real estate and equipment, and intangible assets, specifically intellectual property (“IP”). While EBITDA gets a lot of play in the business world, IP is just as important. Failing to take into account the value of one’s IP and its depreciation over time could be a grave mistake for small business owners, but this blog offers salvation…Websites, catalogs, software, textual and digital content:Copyright law protects a business’s original, creative content, and could include websites, promotional materials, product catalogs, social media content, photographs and other graphic works, etc. Typically, copyrightable materials are protected from use by third-parties for the life of the creator plus another 70 years. For content created by the employees of a business, AKA “works-for-hire,” the owner of the content (hopefully, the owner of the business and her successor-owners) can exclude others from using the content for 120 years from the date it was created or 95 years from the date it is published, posted, or distributed (whichever comes first). Business names, logos, product packaging:Trademark law covers the brand identity – trademarks, logos, slogans, trade dress, etc. – of a business. Service and trademarks registered with the U.S. Patent & Trademark Office (the “USPTO”) will live forever, as long as they are continuously used in commerce, maintained with the USPTO via periodic confirmations of use and payment of fees, and protected against infringement.Inventions, improved processes, formulations:Patent law protects the innovation of a business, including inventions, discoveries, and improved processes and products developed by the business owner or her employees. Patents in the U.S. are granted by the USPTO and last 20 years* (if maintained through periodic payments to the USPTO). Design patents, which protect ornamental elements of functional items, are also issued by the USPTO and last 15 years from the date they are granted.** Plant patents are also a thing, but are rare and even less thrilling to most business owners than the rest of this admittedly unexciting paragraph. Know-how, technical data, customer lists:Trade secret laws exist at the federal and state level and give business owners a perpetual and powerful option to protect certain IP, such as detailed processes that cannot be reverse engineered, valuable research results and data, business plans, and databases of information regarding products, services, customers, and/or prospects. Trade secrets can be maintained and enforced forever as long as the information has demonstrable commercial value, derives value from being maintained as a secret, and maintains its secret status by virtue of reasonable measures taken by the owner of the information.Almost every business, no matter how small, has valuable IP upon which it relies and most businesses will have IP in each category listed above. Succession planning should include an IP audit, including a long hard look at the life and expiration, if applicable, of each IP asset. Don’t let your IP retire before you do!* for any utility patent application filed since June 8, 1995, based upon the earliest priority date claimed** for design patents issued from design applications filed on or after May 13, 2015Attorney Jack Gross counsels small to medium-sized businesses to design succession plans, assisting owners and stakeholders in aligning business, family, and tax goals.