Business owners have a lot of concerns. Among those is what may happen to their businesses in the event of divorce. The truth is, divorce can hurt a business if the right steps are not taken to protect it. As the entrepreneurial spirit has hit numerous individuals in Massachusetts, this concern is certainly wide-spread.
If a business is not properly protected, it may become shared property in a divorce. This can take a serious toll on the company’s bottom-line and long-term outlook. Whether spouses co-own a business, or if a company was started before or after marriage by one spouse, there are numerous things an owner can do to ensure his or her business survives, even if the marriage dissolves.
Prenuptial and post-nuptial agreements can be wonderful tools. These documents can clearly identify the stake of each spouse in a company. If neither of these contracts were executed, however, business owners can still seek an appraisal of the company. This would give a base point for any increase in value occurring during a marriage, and a better idea as to how a business should be split post-divorce. For spouses who co-own a company, negotiating and signing partnership agreements can also give very specific guidelines as to how a business will be divided and what each person’s role in the company will be after a dissolution of marriage.
Divorce does not have to mean the end of a business. Massachusetts residents who take the time to create legally binding contracts that will protect their companies in the event of divorce can move forward and continue growing their businesses with few, if any, ill-effects. A family law attorney can help with negotiating and drafting these contracts. Seeking assistance can ensure a business is treated as the owner would like it to be if — for whatever cause — the marriage is ended.
Source: businessinsider.com, “Here’s how to protect a business from divorce“, Jacqueline Newman, June 8, 2015