Your business is likely an important part of your livelihood. It is in your best interest as an entrepreneur to take every precaution in ensuring that operations can always proceed unimpeded, and that may include divorce-proofing your business regardless of whether or not a marital split seems imminent.
In many cases, business assets are shared property in the eyes of a divorce court. Without taking certain preemptive measures, it is possible that half of your business will go to your spouse in a divorce or that you will have no choice but to liquidate the entire company to facilitate a fair division of assets.
Position your business as a separate entity
When you allow business assets to tangle with personal or marital assets, it becomes difficult to recognize the business as a separate entity. Utilizing different bank accounts for business matters is one positive step toward distancing your company from your marriage.
Get an accurate business valuation
An unbiased business valuation conducted by a professional accountant will reveal the true value of your business, its assets and its income potential. This is a powerful tool you can use to protect your business when negotiating a compromise with your spouse during divorce proceedings.
Sign a written agreement
Signing a prenuptial agreement, or even a postnuptial agreement, can guarantee the fate of your business in the event of divorce. Negotiating these types of settlement agreements gives both spouses the opportunity to advocate for their own priorities in a divorce without intervention from a court.
Divorce is a complicated process, especially when an entire business is on the table. By exercising the options available to you, it is possible to simplify the asset division process and divorce-proof your business while doing so.