In Washington, people typically marry because they believe their relationships will last for a lifetime. Even though these engaged couples have noble intentions, they may want to take extra steps to protect special assets, such as businesses. Emotions often run high during divorce proceedings. Consequently, a business owner or non-owner may suffer monetary losses during the property division process.
Some entrepreneurs include their spouses as legal owners of their businesses. But these business owners especially need to protect themselves in case of a divorce. A married couple can choose to sign a formal contract or make informal arrangements to explicate what will happen in case a divorce takes place. In some cases, married co-owners can continue to manage operations after they split. If animosity is too high, however, it may be wise for one ex to sell off their stake.
When only one spouse owns a business, a family law attorney can draw up a prenuptial agreement that specifically details how the assets will be split. Such a contract could stipulate which assets existed before the marriage and thus would be considered separate. However, it’s important that a prenup be fair for both parties in the marriage. Otherwise, it could be challenged in court.
If there is no prenuptial agreement, a married business owner can prove ownership via financial records and business-related documents. An attorney with experience in family law can help a business owner get through the divorce without experiencing severe financial scars. A common alternative to splitting a business includes offering a separate asset of equal value to the non-owner spouse.