You have plenty of items on your divorce checklist, but do you have a separate checklist listing the tasks necessary to protect your business from divorce proceedings? Do not let a lack of knowledge lead to losing all the time, effort and money you invested in your company.
Forbes lays out several strategies for keeping your business safe from the impact of divorce. Understand how to keep what rightfully belongs to you.
Prenups and postnups
If you and your spouse signed either a prenup or a postnup agreement, you may already have a blueprint for handling your business during divorce. For instance, the document could state that your business is your separate property and safe from divorce proceedings, or your spouse may only have a limited claim to the business’s current value. Is your business an equal partnership? If so, your agreement may stipulate which spouse buys out the other for your divorce.
No agreement
Perhaps no agreement spells out how to handle your business for the split. In this case, consider setting yourself up as the sole owner of the business, ensuring that all documents stipulate the company is nontransferable. Note of sources of business capital, specifying whether you used marital or premarital funds to set up your organization. While you can also separate personal and business expenses, it may be too late to do so. At this stage of the legal process, you may have little choice but to offer your current spouse a cash award for her or his claim to the company and hope it suffices.
Retain as much of your business value as possible after your divorce. Put these tips to good use to come out ahead when the dust settles.