Small business owners in Quincy, Massachusetts, often have a lot of worries on their plates. Though there are many advantages out there for small businesses, the overwhelming resources of big businesses can quickly crush such operations. This makes protecting your small business extremely important, especially in the case of a divorce.
As a small business owner, the property division process during divorce can be your worst enemy. Wondering why? Consider the fact that, for most small business owners, their company is their largest asset. If your husband or wife was not part of the business before the marriage and had nothing to do with starting it, why should they get a part of it during the split?
This is because the business and its associated wealth are considered marital assets in family law court. To some, this may seem unfair, but if money was used from the business to support you and your spouse, it does make sense for it to be counted as part of the marital property. This means that the business can be practically divided in half if you and your spouse cannot come to an agreement.
Imagine a business that is divided between you and your ex. How would running the company work? If you and your spouse cannot behave amicably toward one another, how should you expect to compete against other businesses efficiently? And what about tax issues? There are likely some for both parties if the business is split into two. Instead of allowing this to happen, try offering other things to keep the business as a whole. Some people have bought their spouses' shares of the company from them just to keep the business in working order.
Others who thought ahead to such a situation implemented prenuptial agreements. In such a document, business owners can be sure to retain the business to themselves upon divorce, as long as both parties agree to it.
Source: StartupSmart, "How divorce can cause a messy split in your business," Greg Hayes, Dec. 6, 2012