By: Rosanne S. DeTorres, Esq.
Protect your interest with a pre-marital agreement. Spell out your pre-existing business assets and have your spouse waive any claim to your business in the future. Assess and document the level of your spouse’s involvement in your business. A spouse that lacks involvement in the business has a reduced claim to the business value.
Review your options for establishing a buy-sell agreement, corporation, LLC, or a living trust to restrict ownership and ownership transfer. Revise your partnership agreement to require that the other partners have the option to buy out the interests of the divorcing partner and his or her spouse.
Carefully establish, fund and manage your business with separate assets. Avoid co-mingling business assets with personal assets and business accounts with personal accounts. Pay yourself a market-rate salary.
If a business is at issue in the divorce, a value has to be placed on the business. Agree on a number you both can live with. Then consider how to distribute it to your spouse–by cash payment, by an offset against other assets you will waive, or with installment payments.
If your spouse owns a business and you believe you should receive a share of the value of that business, document all the work, ideas and resources you contributed. Businesses in a divorce can generate complicated legal issues. Choose a family law specialist with a background in business transactions.
Rosanne DeTorres, Esq. is the Managing Partner of DeTorres & DeGeorge, a family law firm in Flemington & Morristown, NJ. She has practiced for 29 years and is the author of the book Divorce: The Answers You Need Before, During & After. Visit: danddfamilylaw.com