Top 10 Estate Planning Mistakes Doctors Make

Physicians spend years building a thriving practice—but many overlook the estate planning steps that protect their business, income, and family if something unexpected happens. The result? Court delays, tax headaches, operational chaos, and personal exposure.

Here are the top 10 estate planning mistakes doctors commonly make—and how to avoid them.

1. Not Having a Business Continuity Plan

Without a continuity plan, your practice could shut down immediately if you become incapacitated or pass away. Patients, staff, and revenue would be left in limbo.

2. No Ownership Transfer Strategy

Most physicians don’t have a written plan for who takes over the practice—or how ownership transitions legally and financially.

A buy-sell agreement can ensure your family receives the value of the practice while giving partners or associates a clear path forward.

3. Failing to Separate Personal and Business Liability

Doctors face unique malpractice and creditor exposure. Without proper separation—like forming an entity, trust, or corporate structure—your personal assets may be at risk.

4. Outdated or Missing Power of Attorney

If no one has legal authority to make business decisions on your behalf, your practice may be unable to:

• Sign contracts

• Make payroll

• Pay taxes

• Continue operating

This is one of the costliest mistakes physicians make.

5. Not Protecting the Practice in a Living Trust

If your practice ownership is not transferred into a trust, it may go through probate—creating months (or years) of delays before anyone can legally make decisions.

A living trust helps avoid:

• Court oversight

• Frozen accounts

• Operational shutdown

• Loss of business value

6. No Succession Plan for Associates or Partners

If you have partners and don’t define:

• Valuation

• Buyout terms

• Transfer triggers (retirement, disability, death)

Disputes or financial depletion can occur right when the business is most vulnerable.

7. No Plan for Patients and Medical Records

HIPAA adds complexity—especially if the practice must close quickly. Without documented procedures, families and staff may be unable to legally manage or transfer records.

8. Using Generic Online Estate Planning Documents

DIY forms rarely address:

• Medical licensing rules

• Business entity ownership

• State-law requirements

• Malpractice exposure

Doctors need tailored planning—not boilerplate paperwork.

9. Not Coordinating Life Insurance With Practice Transfer

If a buy-sell agreement is funded with insurance, but coverage amounts or beneficiary designations aren’t updated, the practice may not have the liquidity needed for a smooth transition.

10. Never Reviewing the Plan

Estate planning is not “set it and forget it.”

Review your documents every 2–3 years or after:

• Marriage or divorce

• New practice partners

• Change in entity structure

• Growth in business value

• Major tax law changes

Malpractice & Risk Management Tie-In

Doctors face higher personal liability than most professions. Without an estate plan aligned with asset protection strategies, an unexpected lawsuit or creditor claim could affect both:

• Your personal wealth, and

• The future of your medical practice

Coordinated planning is your best defense.

Your medical practice is more than a business—it’s your professional legacy and your family’s financial foundation. With the right estate planning, you can:

• Maintain control

• Reduce tax impact

• Keep the practice operating

• Protect your loved ones

Avoid these mistakes — schedule a confidential estate planning review today.

We’ll help you put a customized strategy in place to protect your practice, your income, and your future.