Protecting Business Assets during Divorce

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When two people marry, and they do not sign a pre-nuptial agreement, most of their assets become shared or marital assets, with a few exceptions. This typically extends to businesses—whether or not they were established before the date of marriage. In the event of a divorce, your business may be considered by the courts as a shared asset. This can make the process of dissolution that much more difficult, complex, and frustrating.

There are a few steps you can take to help ensure that your business assets are protected during divorce. One of the wisest choices you can make is to hire an experienced divorce lawyer in Phoenix who has experience in this particular area of law. At Montoya, Lucero & Pastor, P.A., we offer more than six decades of experience, along with a team of dedicated attorneys and legal professionals who can help you understand your options and work toward a favorable solution that protects your best interests.

How to Protect Your Business before Marriage

If you are not yet married, the best way to protect your business is to sign a pre-marital agreement with your future spouse. Though it is not the most romantic of gestures, coming up with an agreement on how assets—including your business—will be divided in the event of divorce is a smart move for any business owner. A pre-marital agreement can clearly lay out how your business and its monetary value will (or won’t) be divided amongst the two of you should you ever divorce, helping you avoid future problems.

If you are just starting a new business, you might want to consider incorporating as a way to protect your business. Even if you are the only owner, it’s possible to form your business as a corporation or LLC, or even place your company in a trust to protect its assets in the event of future divorce.

Too Late to Sign a Pre-Nuptial Agreement? Here’s What You Can Do

If you already entered into a marriage without a pre-marital agreement and are now facing divorce, it may be possible to still protect your business. Perhaps the simplest thing you can do is to maintain an amicable relationship with your soon-to-be ex-spouse. This is especially important if your spouse was involved—or even a partial owner—in the business. While it can be somewhat difficult to maintain a great personal relationship, a good-natured working relationship can make all the difference.

Of course, this is not always possible. In contentious situations, you may be unable to protect your business and its assets entirely. However, if your spouse is not interested in the business itself and is simply interested in its monetary value, you may be able to make up financial worth with other assets, such as real estate property, material items, or stocks.

What If My Spouse Was Involved in the Business?

Even if your business was founded prior to marriage, if your spouse made contributions to it during the marriage, the business will likely be considered a shared asset by the court. Contributions can include but are not limited to financial investments or employment. If your spouse was a co-owner or in any way involved with your business, it can be difficult to protect it in the event of divorce. It’s wise to seek the assistance of a Phoenix divorce lawyer who can help you weigh your options and work to protect your interests.