Inherited firms rise among wealthy Americans amid wealth transfer
Bank of America says inherited businesses are set to outpace purchased ones among wealthy Americans, reversing the pattern seen in 2022.
By Hana Yoshida · Markets Reporter
3 min read
Wealthy Americans are expected to inherit businesses at more than twice the rate they buy them in 2026, according to Bank of America. The shift shows that the Great Wealth Transfer involves operating companies as well as cash, securities and real estate.
Bank of America Private Bank’s Study of Wealthy Americans projects that 23% of businesses held by wealthy Americans in 2026 will have been inherited, while 11% will have been purchased. In 2022, the bank said the pattern ran the other way: 28% of businesses were bought and 5% were inherited.
The study surveyed 1,400 U.S. adults with at least $3 million in investable assets. Bank of America said it examined how high-net-worth households build, hold and pass down wealth.
A business angle on the wealth transfer
The change comes as economists and wealth managers track a large intergenerational transfer from Baby Boomers to younger heirs. Estimates cited by Fortune range from $36 trillion to $124 trillion in assets over the next two decades.
Jonathan Parker, a financial economics professor at MIT Sloan School of Management, told Fortune that the way businesses change hands can help show broader economic patterns. He linked the growing inherited-business share to concerns about wealth concentration.
The Federal Reserve Bank of St. Louis says the top 1% of U.S. households hold nearly one-third of U.S. wealth, about $44 trillion. That is roughly equal to the wealth held by the bottom 90% of households, according to the St. Louis Fed data cited by Fortune.
Parker said the U.S. creates many businesses, which he described as generally positive, but business ownership also tends to produce uneven gains for founders and owners. He told Fortune that a key issue is how much of that wealth owners leave to heirs late in life.
Parker also pointed to family size. He told Fortune that wealth has long been associated with fewer children, a pattern economists have studied since the Industrial Revolution, and that wealth left to one child is less dispersed than wealth divided among several heirs.
Private firms and tax rules may play a role
Fortune also reported that inherited ownership may reflect companies staying private longer. Apollo chief economist Torsten Slok, citing economist Jay Ritter, has noted an increase in the median age at which companies go public since 2022, when the Federal Reserve began raising interest rates.
That trend has coincided with growth in private capital, Fortune reported. Venture capital and private equity have allowed larger companies to raise substantial sums outside public markets, making some private businesses harder for founders to cash out of quickly.
Parker told Fortune that tax rules may also encourage owners to hold assets until death. He cited the federal estate tax exemption, raised to $15 million per person under the One Big Beautiful Bill Act, and the step-up in basis, which can erase capital gains tax on appreciation that occurred during the original owner’s lifetime.
Bank of America did not provide data on how long owners are keeping companies before transferring them, according to Fortune. The bank’s report said a notable share of business owners had no plan to leave their companies, while most planned eventually to transfer or sell ownership to family heirs.
This story draws on original reporting from Fortune.