It can be frightening to go through a divorce as a business owner. You worry that you could lose your business or the assets you need to make it run.
The best thing you can do to protect your business is to have a prenuptial agreement in place before you get married or get a postnuptial agreement after you get married. These agreements give you a chance to ask your spouse to legally say that the business assets go to you alone in a divorce. You can split up what you own as a couple, but not the company.
- Keep excellent financial records so that you can prove what money belonged to the business, where it came from and what it was used for.
- If you have the business when you get married, have a professional do a valuation of it. This way, you can accurately assess the change in value at the time of the divorce.
- Use the business to pay yourself a salary that fits your position in that field. Giving yourself a salary shows that the money paid to you belongs to you and your spouse as income, a marital asset, while other income from the company still belongs to the company.
- If possible, do not work with your spouse. If you own the company together or even work together, things can get vastly more complicated.
These tips can help, but you may still run into some serious legal snags. Make sure you know what options you have and what steps you need to take to protect yourself and your business in your divorce.