Minnesota Divorce & Family Law Attorney
As a business owner, you have probably put a lot of blood, sweat, and tears into your business. You have worked hard to make it as successful as possible. If you are going through a difficult time in your marriage (that may end up in divorce), you don’t want to have to worry about losing your business too!
Here are some tips to protect your business in the event of your divorce.
One of the best ways to protect your business is by not involving your spouse in it. Many couples think that it is a good idea to go into business together. That can be a big mistake, especially if you end up going through a divorce. Sometimes, one person starts the business and then employs their spouse once the business takes off.
No matter how much (or little) your spouse is involved in your business, if he or she has helped at all, he or she is entitled to a part of your business if you end up divorcing. Obviously, the more that he or she has contributed, the bigger the percentage he or she is due.
If you don’t want to go through this difficult time and have to worry about your business, keep your spouse out of it!
If you had your business prior to getting married, you should have gotten a prenuptial agreement. This is the best way to ensure that you get to keep your business, even after a divorce. If you waited, you could also look into a postnuptial agreement, which is like a prenuptial one except that it is made after the wedding. However, you can’t make one up if you are planning on separating. You need to protect your business right away.
Unfortunately, it can be hard to validate a postnuptial agreement. They are often challenged and invalidated. Prenuptial agreements are better, though they can also be challenged.
In order to protect your business, you should make your business a partnership or a LLC. A lawyer will help you set up your business legally to make sure that it is protected from your spouse.
Don’t go through this process on your own. Hire a good lawyer to be on your side. You will need someone to fight for you and your business. Because of this, it might also help to ask a lawyer about his or her experiences with business owners and divorce. If they have helped multiple entrepreneurs through this process, there is a good chance that they can help you too!
It is important to go into the divorce proceedings knowing exactly how much your business is worth. You are going to have to look at your assets, the market, and your income. Your financial records are going to have to be up-to-date and reliable.
Then, you can make a plan with your lawyer. It is important that you realize where you want to go from here. You might not want to keep your business going and that is fine. Many business owners buy their ex-spouse of out of the business so that they can keep it going. You have to decide exactly what you want for your new future.
Try to keep your divorce from getting messy. Divorce can become very hostile very quickly. However, in order to protect everyone involved, it is best to go through mediation and talk during the whole divorce proceedings. Do your best to communicate about what you want and listen to your spouse when he or she tells you what he or she wants.
Find a way to compromise and get through the divorce as simply as possible. Don’t make it a war just because you feel like you have to win! Give and take so that both of you can come out the other side as fine as possible.
Find ways to move on after the divorce is over. Many people let their divorce define the rest of their lives because they just can’t move on. They seem to be angry and upset for years. Yes, you need to take time to grieve but you can’t let it hold you back from moving on.
Many businesses fail after a divorce because the owners make bad business decisions. They are still grieving, angry, and are just not in the right state of mind to focus on their business. Don’t let that be you and your business. Always remember the end goal (a successful business) and don’t make quick decisions in the moment. Give yourself time to think through everything so that you don’t make any bad decisions in the months (or years) following your divorce.
Getting divorced is always scary. However, if you have a business to protect, it can be even worse. One of the best ways that you can protect yourself is by keeping your spouse out of it. Make it your own business (with as little involvement by your spouse as possible). The more that he or she is involved, the more that you will owe him or her down the line.
If you started your business before you got married, you need a prenuptial agreement. This can really protect you from losing your business. If you are already married, you can try to draft a postnuptial agreement, though these are often challenged so it might not help as much as you would like. You may also want to look into a LLC or partnerships. Though these costs money, they can protect you in the event of a divorce.
If you are already thinking about divorce, make sure that you find yourself a good lawyer, especially one who has helped other business owners go through this difficult time. He or she will be very helpful to ensure that you don’t lose your business.
When you do get a lawyer, make sure that you talk about your future. What do you want for your business? Do you want to run it? Do you want to give it to your spouse and walk away? Or are you ready to close it down completely? This will help your lawyer come up with a plan so that you are happy with the results.
Contact us to help you through this difficult time.