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How to protect a business in divorce

by | Mar 10, 2017 | Property And Asset Division

Divorce can be a frightening topic for some and an easy topic for others. It is becoming all too common for marriages to end in divorce, which is why you need to educate yourself on how to protect yourself and your business after divorce.

One of the easiest ways to protect your business after divorce is by creating a prenuptial or postnuptial agreement. These agreements are written, legal documents that define who owns what property and how it is to be divided should the marriage end in divorce. It is a good idea to have the prenup or postnup signed in front of a witness who is also a notary.

Another option for protecting your business after a divorce is to use one of the following options: shareholder, partnership, LLC or buy-sell agreements to lock-out the spouse. These are perfect for businesses that are owned jointly by one or more people. It would protect the other business owners should one of the owners get divorced.

Consider paying yourself a competitive salary from your business. This can help protect it should you get divorced. Do this instead of reinvesting the money back into the business. If you reinvest the money back into your business, your soon to be ex might claim the business did not provide enough money for the household. Your soon to be ex cannot make this claim if you pay yourself a competitive salary.

If you have yet to get married, you should seriously consider not letting your future spouse get involved in your business. This might be easier said than done in certain situations, but it can save your business should the future marriage end in divorce. The more involved your spouse is involved in the business, the larger amount of compensation he or she might be entitled to in a divorce agreement.

Visit our page to learn more about protecting your business after a divorce in Oneida, New York.