Divorce is often one of the most stressful and daunting events an individual will ever have to experience. You may find the process of dividing property and assets to be extremely complex, especially if you are the owner of a business. Perhaps you are the sole operator of the business, and you have spent a great deal of time and money into making it a successful and thriving enterprise. You may wish to protect your enterprise during this period, but you may be unsure how to achieve this goal.
How do I know if my divorce will affect my business?
You may hope to secure the future of your business during your divorce, leaving you to wonder how the subsequent process will affect it. Some key factors that may determine how ending your marriage will impact your enterprise are as follows:
- Prenuptial agreement: If you and your spouse have a prenuptial agreement in place, it may dictate the division of specific assets, such as your business. You may find these specific precautions crucial to retaining sole ownership of the business you worked so hard to build.
- Postnuptial agreement: If you started the business during marriage, you and your spouse may have negotiated and signed a postnuptial agreement. While these agreements are similar in nature to prenuptial agreements with regards to the division of assets, they may not be as ironclad.
- Salary: If you choose to reinvest a great deal of your earnings back into your business, your spouse may claim partial rights, since a substantial portion of your wealth contributed to your business and not to the household. You may want to consider paying yourself a larger salary to potentially avoid a similar outcome.
- Spousal contribution: Perhaps you are still the sole owner of your business, but you brought your spouse in to assist from time to time. If your spouse contributes to the success of your business in any way, he or she will likely be entitled to a portion of it during proceedings.
Perhaps your business, or at least part of it, has become marital property. Since New York is an equitable distribution state, you may have other options available. In similar states, the division of assets must be fair, but doesn’t have to be equal. If you want to retain possession of your business after divorce, you may choose to relinquish ownership of other assets, such as a house, to your spouse in exchange for sole ownership.
Where can I turn for advice on protecting my business?
You may consider your business to be invaluable, and you may wish to explore all available options to retain sole possession of it. With a plethora of crucial aspects to consider during this challenging process, you may choose to seek guidance from an experienced attorney. A family law attorney can assist you throughout this stressful life event and provide advice on how protect the longevity of your business during your divorce proceedings.