Multiple protective actions exist to secure your business from financial obstacles, including a divorce. For example, you may transfer your business to a trust or safeguard it through a prenuptial or postnuptial agreement.
What if you did not do any of those things and now you face the end of your marriage? Is your business in jeopardy? Perhaps, as the court may consider some or all of it as marital property. Still, you have a few ways to prevent your spouse from taking more than he or she deserves.
Remove your spouse from involvement
If the business is primarily yours but your spouse contributes in some way, then your spouse will have claim to the company. The sooner you remove your spouse from participation, the better for you. If you both own the business, make sure the roles you each play are clear, as they determine how much stake you each have in the company.
Determine the value of the business
If you underestimate the value of the business, you may find yourself in ugly battles over property division, child support and alimony, as well as facing legal consequences for attempting to hide assets. If you overestimate it, you may find yourself in financial trouble when the divorce is over. Have a professional perform a valuation so you have more accurate information to work with in your divorce.
If you really want to keep the business, be willing to give up your share of other valuable assets in exchange. This approach is usually satisfactory for both parties unless you are dealing with an extremely vengeful ex. You also have the option of selling the business and splitting the profits, though this is not a common action.
You can discover more options better suited to your situation by talking to various professionals, such as your accountant, lawyer and certified divorce financial planner.