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Are you at risk of losing your business in a divorce?

If you are a business owner who is considering filing for divorce, you need to first examine how a divorce could affect the ownership of your business. You don't want to end up having to sell the business or perhaps even worse, remain in partnership with your ex.

So, what options do you have in these situations?

Ideally, before you got married, you and your spouse signed a prenuptial agreement that protects your business in the event that you later divorce. But even if you haven't done so, you could still both sign a post-nuptial agreement ceding all interest in the business to you if you split. But doing so right before filing for divorce could be construed as misleading by the court.

Options for business owners who divorce

If you want to later claim that the business is your separate property, you would do well to strictly limit or entirely avoid involving your spouse in the running of your business. That means if you are a doctor, your spouse shouldn't be the office manager of your practice. If you own a lumber company, your spouse shouldn't sit on the board or hire and fire employees.

There also is the matter of commingling, which your divorce attorney can explain to you in greater detail. Basically, to keep from turning separate property into marital property, the proceeds from your business should not be mixed into accounts you share with your spouse.

What if you have commingled or hired your spouse?

You may want to consider taking on another partner in order to buy out your spouse's interest in your business. However, before entering into any contractual agreements, it is vital that you loop in your Vienna business law attorney to make sure that your interests and the interests of your business are fairly represented.

Beware of falling prey to any scams wherein you fraudulently transfer your interest in the business to a third party who is collaborating with you. You could wind up on the wrong side of the law by colluding with another person.

Your business means a lot to you. It is almost like another child. That's why it is imperative to do all that you legally can to protect it and your full ownership interest from the ravages of divorce.

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