3 Ways To Protect Your Business If You And Your Spouse Are Planning To Divorce


After you and your spouse file for divorce, all of your marital assets will be considered for division. If you own a business, it could also be part of the assets. If you believe that you and your spouse are headed for divorce, here are some ways you can protect your business starting today.  

Keep Your Assets Separate

If your business and personal assets are commingled, now is the time to separate them. By continuing to allow your finances to mix, you are making your business vulnerable to your spouse. Your spouse could argue that he or she is entitled to a share in your business's assets because the personal and business finances are integrated.  

Even if you and your spouse do not divorce, keeping your business and personal finances separated is a good idea. In the event that your business has financial troubles, your personal assets will not be impacted.  

Encourage Your Spouse to Leave the Business

If your spouse has been working in the business, now is the time to encourage him or her to explore other career options. Although it might seem harsh, the longer your spouse is involved in the business, the stronger his or her argument for part of the business assets becomes.  

Your spouse could claim that by working in the business, he or she has helped to build it. A divorce court judge will take into account your spouse's participation and likely reward him or her for it. Not only could your business's current assets be divided with your spouse, but if a judge agrees that he or she helped to build the business, your future profits could also be split.  

Establish a Trust

A trust could provide your business with the protection that you need. If you establish a trust, you can name the trust as the owner of the business.  

There are several reasons to set up a trust, but the most important is that if you and your spouse do divorce, you could argue that your business should not be considered as a marital asset. The court might be willing to believe that since the business is owned by a trust, it is not technically yours and not part of your assets.  

Talk to your divorce attorney about other ways you can protect your business. He or she can not only review your legal options for the business, but also your other assets. 

About Me

Law Information Everyone Should Know

Hi, my name is Jessica Hawkins and welcome to my law blog. My mom and dad are both attorneys so I grew up with a lot of law talk around the house. Even though I decided not to become an attorney, I still have an interest in the law. Plus, when I visit my parents, that's all they want to talk about, so I still learn what I can about the law so that I can join in on the conversation. I wanted to create a blog to inform others about various aspects of the law. In this blog, you'll also find out about the different types of attorney specialties and when it's best to consult an attorney. I hope that you find my blog useful and that it helps to answer your law questions.

Search

Categories

Archive

Latest Posts

2 December 2017
The best thing that you can do when you are struggling with debt is to contact a bankruptcy lawyer, typically because this individual will be able to

27 January 2017
If you are applying for bankruptcy discharge, look out for allegations of fraud from the bankruptcy court. The court can suspect you of fraud even for

19 January 2017
Fiance visas can help to reunite you and your future spouse, but obtaining and keeping one can sometimes be challenging. There are strict requirements