by Cody Emerson
As a woman in the male-dominated world of business, you must work harder and put in longer hours, all while trying to find balance with your home and family. It is stressful and challenging, and can sometimes lead to unexpected consequences, namely divorce.
Divorce is a rearrangement of your entire life, including a “fair and equitable division of your assets”- which may include your business!
If you do not take steps to protect your business from divorce, then you could end up in a situation where your recently divorced ex-spouse becomes your new business partner, or you could lose your business entirely. Neither of these is a desirable outcome for most women.
If your marriage is on the rocks, or divorce has been mentioned or is in progress, then it is important that you take measures to protect your business.
1. Get A Post-Nuptial Agreement. It is best to plan when things are going well, instead of reacting when they are not. A postnuptial agreement that can determine who keeps what important assets in a divorce, and can include business assets.
2. Keep Business and Family Separate. Don’t mix business finances with home finances, and don’t employ your spouse. Using family funds to support your business means that you are not only using your own money, but also that of your spouse, making it a joint venture. The less involvement they have, the better.
3. Pay Yourself! By paying a stable and steady income to yourself, you are further showing proof that the business has not been a drain on the family assets. An appropriate income also shows that you are not keeping profits in the business that your spouse would have otherwise benefited from.
4. Use an LLC or Trust. By placing the business in a trust, or converting it to an LLC, you are no longer the direct owner of the business, protecting it from being counted as a marital asset.
5. Prepare to Negotiate. Offer high value assets to your spouse for bargaining purposes, especially if you can live without them. House, cars, and retirement accounts all make great alternative offerings for your spouse. You also have the option to make payments towards their share of the business over time, allowing you to retain ownership, and still complying with equitable division of assets.
Bonus Tip: Get Your Own Lawyer! In order to make sure that your interests are best protected, it is advised that you get separate legal counsel. This way, there is no “playing favorites” and you can ensure that you are being represented by a qualified and experienced divorce attorney who is solely interested in getting the best possible outcome for YOU.
No one goes into marriage expecting divorce, but a good business owner does their best to plan for all potential outcomes of any decision that they make. Take the steps that you can now, and be prepared to negotiate if necessary. It is your business, and you have the responsibility to protect it.
Cody Emerson is a Family Law and Divorce Attorney located in St.Petersburg, Florida. Emerson Law is adamant about providing their clients with the best possible service, and his reviews and repeat business prove his commitment to his clients.
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