When you own a business, you know how important it is to protect your assets and interests before they’re threatened. Unfortunately, if you and your spouse divorce, this may become a top priority. In a marriage, all assets and properties owned by one spouse fall under the ownership of both spouses, which means your spouse may be entitled to a share of your business. Even if your spouse has had absolutely no involvement in your company since your marriage, they could still attempt to claim a portion of it as their own when you divorce.
The divorce process is never easy, but as a business owner, you might face an additional set of challenges as you fight for the right to retain your business. As a business owner, you need to take extra measures to ensure your company is protected from a potential split, whether you own the business on your own, with a partner, or with your spouse. In order to do so, there are things you can do before you divorce, or before you’re even married, to keep all business assets separate.
Prenuptial & Postnuptial Agreements
The very best way you can protect your business from a divorce is to create a prenuptial or postnuptial agreement. These agreements can do several things to protect you and your assets, but it can be especially helpful for business owners. In the agreement, you and your spouse can agree that all of your business interests will remain just that—yours. This way, if you ever should divorce or seek a legal separation, your business won’t be touched.
Track Your Spouse’s Involvement
While it is easier to protect your business before the threat of divorce looms over you, it is still possible to protect your interest after you’ve decided to go your separate ways. If you and your spouse have discussed a divorce, or if you think your marriage may be headed that way, take extra precautions to protect your business interests. One way you can do this is to track how involved your spouse is. If your spouse has no involvement in the business, this should be easy. However, if they contribute to the business in any way, or if you share the business, keeping track of their involvement in comparison to your own could help you later on when discussing property division.
Negotiating a Tradeoff
If you and your spouse share the business, or if they contribute to its growth or upkeep in any way, you may need to negotiate to keep your business after the divorce. In order to do this, you may need to negotiate, either in court or through mediation, to find a workable solution that benefits both you and your spouse. In other words, if you wish to retain the business, you may need to turn over other assets to your spouse as a tradeoff. If you keep the business, they may get the vacation home, or a larger portion of your savings, or other valuable assets in turn.
In order to protect your business interests from the threat of your divorce, make sure you take every precaution possible. Contact Patton & Pittman Attorneys to schedule a free consultation with our Clarksville divorce attorneys.