Problem 1 — Your Business Interest Goes Through Probate
A will must be filed with the Georgia probate court before any transfer occurs. The probate court’s authority must be invoked at death, no transfer to the beneficiaries happens before the court process concludes.
For a Georgia business owner, this means the LLC membership interest sits inside the estate while the court works through the administration process. The LLC entity itself does not go through probate, but the ownership interest does. That interest cannot be transferred to your family until the court authorizes it.
The complex probate cases we’ve handled, including business estates, have taken about 25 months. Contested estates can take longer. For a detailed phase-by-phase breakdown of every stage, see How Long Does a Georgia Business Go Through Probate.
Problem 2 — With Partners, the Estate Gets Assignee Rights, Not Management Rights
This is the problem most Georgia business owners do not know about until it is too late.
Under O.C.G.A. § 14-11-506, when a member of a Georgia LLC with other owners dies, the estate’s legal representative has the rights of an assignee only. An assignee receives economic rights: a share of profits, losses, and distributions. An assignee does not receive management authority, voting rights, or the ability to participate in running the business.
For the estate to gain full membership rights (including management authority), the operating agreement must specifically allow it, or all remaining members must unanimously consent. Neither happens automatically.
This means the family can receive the business’s cash distributions during probate. They cannot vote, sign contracts, hire employees, or make operational decisions on behalf of the deceased member’s interest.
Problem 3 — A Gap in Who Speaks for Your Share
The assignee-only rule creates a governance gap during the probate period for multi-member LLCs. The remaining members manage the business, but they manage it without the deceased member’s voice, vote, or operational input.
If the deceased member was the managing member, the business may have no one with the legal authority to fulfill those functions through the deceased’s ownership interest. The executor gets a vote only if the operating agreement allows it or all the other owners agree.
For a full picture of what this costs the business, see How Much Does It Cost if a Georgia Business Goes Through Probate.
Problem 4 — Your Will Becomes Public Record
When a will is filed with the Georgia probate court, it becomes a public document. Anyone can request to view it or obtain a copy.
For a business owner, that exposure can reveal details you spent years keeping private: what the business is worth, who gets what share, the ownership structure of any entities referenced in the will, and the identities of every beneficiary.
A revocable living trust does not go through probate and is not filed with any court. Trust documents remain private.
Problem 5 — Executor Pay Comes Out of the Estate
Georgia’s rule for executor pay is in O.C.G.A. § 53-6-60. If no written pay agreement and no will sets the executor’s pay, Georgia law gives the executor 2.5% of the money they collect for the estate and 2.5% of the money they pay out, and the probate court may also allow up to 3% of the value of any property handed over without being sold. Administration costs (including executor commissions and attorney fees) are paid before unsecured creditors and before beneficiaries receive anything.
Problem 6 — The Creditor Notice Window Extends the Timeline
Under O.C.G.A. § 53-7-41, every Georgia personal representative must publish a creditor notice in the county’s official newspaper once per week for four consecutive weeks, within 60 days of qualifying. This notice period is a statutory minimum. The estate cannot close before it completes.
The creditor notice process is mandatory regardless of whether the deceased had any outstanding debts. It cannot be waived or shortened. This alone adds months to the minimum probate timeline before any transfer can occur.
The Sole-Member LLC Exception
The assignee-only rule under O.C.G.A. § 14-11-506 applies to multi-member LLCs. For single-member LLCs, the same statute makes the estate representative a member, unless they turn it down in writing within 90 days.
Single-member LLC owners still face probate, which has taken about 25 months in the complex probate cases we’ve handled, plus public record exposure and executor commissions. No one can act for the LLC until a probate court appoints the executor. The assignee problem does not apply to them.
If you own a single-member LLC and your heirs do not want to run the business, the estate still goes through probate before the interest can be transferred to a buyer or distributed to beneficiaries.
The Alternative — A Funded Revocable Living Trust
Transferring a Georgia LLC membership interest into a revocable living trust during the owner’s lifetime removes the interest from probate entirely. When the owner dies, the successor trustee takes control without any court involvement.
The trust bypasses probate because the membership interest is owned by the trust, not by the individual. There is no estate to administer for that asset. The successor trustee follows the trust document and transfers the interest to the named beneficiaries in days, not months.
For the trust to work, it must be funded during the owner’s lifetime. The LLC membership interest must be retitled in the name of the trustee. An unfunded trust provides no probate protection.
For multi-member LLCs, the operating agreement must also be updated to grant the successor trustee management authority. Without that amendment, the trust inherits the same assignee-only problem.
For a side-by-side breakdown of every difference, see Revocable Trust vs. Will for a Georgia Business Owner.
The Three Documents a Georgia Business Owner Needs
A will alone does not solve the succession problem. Three documents, coordinated with each other, do. For a complete picture of what can go wrong even with a partial plan, see Problems With Business Succession Plans in Georgia.
1
A Funded Revocable Living Trust
The trust holds the LLC membership interest. At death, the successor trustee transfers the interest without court involvement. The trust must be funded (the membership interest retitled to the trustee) during the owner’s lifetime. An unfunded trust does not avoid probate.
2
An Updated Operating Agreement
The operating agreement must name the successor trustee as the authorized manager, or include a provision allowing a trust to be admitted as a full member without unanimous consent of remaining members. Without this amendment, the trust owns only an assignee interest, the same limit a will produces in an LLC with partners.
3
A Funded Buy-Sell Agreement (Multi-Member LLCs)
If there are other owners, a buy-sell agreement determines what happens to the membership interest when a triggering event occurs. Without it, the remaining owners and the estate are left negotiating a buyout at the worst possible time.
For a full overview of how Georgia business owners structure a complete plan, see Best Estate Planning for Business Owners in Georgia.
