What Happens to Business Debt When the Owner Dies in Georgia
When a Georgia business owner dies, business debts do not disappear. Creditors can file claims against the estate, and personal guarantees can turn business debt into a personal liability that reduces what your family inherits. Georgia law handles business debt a specific way after an owner dies, and there is something you can do now to protect your family.
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THE PROCESS
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Melissa Breyer
Georgia Estate Planning Attorney
Melissa Breyer is a Georgia estate planning attorney who works exclusively on trust-based estate planning and LLC formation. She personally designs and drafts every plan at The Hive Law after the initial call. Every plan is built from scratch for your specific family, your specific assets, and your specific wishes.
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After my father passed away, my mother had to rely on my father's employer to navigate the estate. It was a disaster. After this experience, I knew I needed a plan. I turned to The Hive Law to set up a trust. I no longer have to worry about my wife and children going through a difficult process if something happens to me. I highly recommend The Hive Law!
My biggest fear was that if I died first, my wife would have no idea how to navigate the estate and legal system. I reached out to The Hive Law and they put my mind at ease immediately. Their process is easy to follow and they took care of everything. The Hive Law is the best decision I've made for my family's future.
Working with Melissa Breyer to set up our Living Trust was a wonderful experience. She and her entire team were knowledgeable, professional, and made the whole process easy to understand. I highly recommend The Hive Law for all your estate planning needs!
We highly recommend Hive Law. They were extremely patient and responsive, answering our many rounds of questions regarding trusts and estate planning. Shawn consistently responded the same day we sent our questions, even while his family was on vacation, which we greatly appreciated. Shawn was also always available to discuss matters by phone whenever we needed additional clarification on the options we were considering. Both are very knowledgeable in estate planning, and we would confidently recommend Hive Law to friends and family.
The Hive Law made the entire estate planning and trust process easy to understand and stress-free. Melissa and Shawn walked us through every step and answered all of our questions. We feel confident that our family is protected. Highly recommend!
My mom chose The Hive firm to help with estate planning and developing a trust to protect her assets. I sat in on her meeting with Melissa, and Melissa did a great job of simplifying complex legalese into easily understood concepts. Shawn was very quick to get us our documents and all steps in the process were clear and easy. They make a great team and we are thankful for their help!
I used The Hive Law to help me create a trust for my family. The process was straightforward and Melissa and Shawn made sure I understood each step. They were responsive to all of my questions. I feel much more confident about my family's future now. Highly recommend!
Working with Shawn and Melissa at The Hive Law has been an excellent experience. They were one of three firms we contacted, but she made the strongest impression during our initial call. They asked great questions to understand our situation and clearly explained what we needed to put in place. We initially had some reservations about their fully virtual approach, but those concerns were quickly put to rest. After the first two calls, it was clear how easy they are to work with and how well connected we felt. Communication has been clear, organized, and reassuring throughout the process. Shawn and Melissa are professional, approachable, and thorough. We feel confident we're in good hands and highly recommend The Hive Law for estate planning.
The Hive Law Firm, and specifically Melissa, has been wonderful to work with during our estate planning process. She is knowledgeable, patient, and thorough. She answered all of our questions and made the process easy to understand. I highly recommend The Hive Law!
Shawn and Melissa were amazing to work with! My partner and I recently bought a house and wanted to get important things like wills, healthcare directives, etc. set up. They were incredible at answering all our questions and working with us to make sure we felt confident in all of the legal aspects. Having tried to do this online before with one of the DIY tools, it was just an amazing experience to get to talk through what we wanted with a knowledgeable human and have them take care of the details.
Hive Law was awesome to work with! Melissa and Shawn explained everything, kept things stress-free, and were always quick to respond to my questions. They made the whole process simple and smooth from start to finish. Highly recommend if you want a team that's knowledgeable but also easy to work with.
I lost my father in February of this year without any estate planning in place. The process of dealing with the probate court has been overwhelming and expensive. After this experience, I contacted The Hive Law to set up a trust so my children never have to go through what I've been through. Melissa and Shawn were compassionate, knowledgeable, and made the entire process simple. I highly recommend The Hive Law!
I used to know the bare minimum about probate and trust. I first encountered Shawn Breyer on Facebook. He was offering a webinar that I watched. That gave me a better understanding of probate versus trust. I was impressed enough to have him and his wife represent me. I had my initial one on one interview with Melissa Breyer, it went smoothly and she made everything clear. We are now proceeding with getting a revocable trust in place.
The Hive Law has been amazing throughout the process of setting up our trust. Every detail is considered and no stone is left unturned. They have been easy and enjoyable to work with. I would absolutely recommend them! Don't let your estate be turned over to Probate!!
The Hive Law helped us set up a revocable trust. Their webinar is great for answering any questions you may have, to clarify and avoid probate. Get in touch with them right away, you won't be disappointed.
Melissa was great! She gave me an honest review of my future plans that I already have in place. Turns out, I already had my ducks in a row!!! She was a pleasure to talk with!!
For several years now I have been thinking about having a will drawn up, but continued to procrastinate until an older sibling had a medical situation occur which none of the family was prepared for. This was the determining factor for me to get it done. We never know when an emergency medical situation could arise and I didn't want my other siblings to be scrambling around trying to figure things out in the event I couldn't make any decisions for myself, or God forbid I pass away. My attorney (Melissa), was very funny and made the whole experience quite entertaining. She listened to what I wanted and explained the type of plan I needed. Thanks Melissa & Shawn for making the process an enjoyable experience.
The Hive Law Firm did an excellent job helping my mother-in-law with her estate plan. The process felt overwhelming at first, but their team walked us through every step with compassion and professionalism. They listened to our concerns, explained things in simple terms, and made sure our mother's wishes were honored. We're very grateful for their guidance.
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The whole process of creating a family trust felt simple, clear, and stress-free. We really appreciated how patient, helpful, and easy to communicate with the team was throughout everything. Shawn and Melissa gave us great guidance and helped us feel confident every step of the way. We're grateful for their support and would definitely recommend them.
Frequently Asked Questions
Not for LLC debt without a personal guarantee. If your LLC carried debt and you never signed a personal guarantee, your family does not owe that debt after you die. The creditor’s claim is against the LLC’s assets only.
If you signed a personal guarantee, the answer changes. That debt becomes a claim against your personal estate. Your executor must pay it before distributing any inheritance. The difference between these two outcomes is entirely determined by whether you signed a guarantee — and most small business owners have signed guarantees on every major financial obligation they carry.
Creditors can file claims against your estate during the Georgia probate process. Under O.C.G.A. § 53-7-17, they have 4 months from the date notice is published to file. Valid claims are paid before heirs receive distributions.
If your business debt is personally guaranteed, those creditors can file estate claims and reduce what your family inherits. Assets held in a revocable living trust pass outside of probate, which changes the timeline and process — but does not eliminate the underlying obligation on a personal guarantee.
A personal guarantee is a clause in a loan, lease, or financing agreement where you agree to pay personally if the business cannot. It removes the LLC’s liability shield for that specific obligation.
Most Georgia small business owners have signed personal guarantees on bank loans, SBA loans, equipment leases, and commercial real estate leases. Check the signature pages of your loan documents. The guarantee clause is usually in the same section where you signed. If your name appears on a signature line labeled “personal guarantor” or “individual guarantor,” you have a personal guarantee on that obligation.
SBA loans almost always include personal guarantees. When you die, the outstanding loan balance is a claim against your estate. Your executor must address the SBA loan during probate, and the loan does not simply go away because the business ceases to operate.
SBA loans frequently also include spousal guarantees — your spouse may have signed as a guarantor even if they are not involved in the business. Check your SBA loan documents specifically. If your spouse is a co-guarantor, they remain liable after your death regardless of what your estate can pay.
Under O.C.G.A. § 53-7-17, creditors have 4 months from the date the executor publishes notice to creditors. That notice is published in the official county newspaper. Once the 4-month window closes, claims filed after the deadline are barred.
The executor is required to review each claim and accept or reject it. Accepted claims are paid from estate assets before any heir receives a distribution. This is why business probate takes 18 to 30 months — the executor cannot distribute to heirs until the creditor window closes and valid claims are resolved.
A revocable living trust does not eliminate personal guarantee obligations. If you signed a personal guarantee, that liability follows you into your estate whether or not you have a trust. The trust does not change what you owe — it changes how and when assets pass to your family.
What a trust does accomplish: trust-held assets pass outside of probate. This means they are not part of the public probate estate that creditors file claims against through the probate court process. The timing and process of creditor access to trust assets is different from probate assets — and in some situations, that distinction matters. Talk to an estate planning attorney about your specific guarantee exposure before concluding whether a trust addresses your situation.
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You’ve been meaning to do this for a while now. That’s normal. Most families wait until something happens, then wish they hadn’t.
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