If you are going through a divorce and run your own business, one of the things you need to do is to think about how you want to protect your business. If your spouse is involved in the everyday workings of your organization, you may find that it is more difficult to unravel your business relationship than your romantic relationship, but there are steps you can take to do so.
There are a few steps you can take to protect your business during your divorce. Here are three to consider as you work on resolving your divorce issues.
- Establish ownership
One of the first things to do is to establish ownership of your business. Are you the sole owner? Did your spouse participate in the business? Do they agree that you had the business before marriage? Establishing this information will help you determine how much your business could be at risk.
- Recognize the market standards for your income
When you run a business, you usually pay yourself an income. That income may or may not be in line with the market standard. If your income is out of alignment with that standard and your business is holding onto funds you could be paying yourself, your spouse may argue that the full income should be considered when the court determines if they need spousal support. This could negatively impact your business or your personal finances, so it’s something to be aware of and address early on.
- Be ready to negotiate
Whether your spouse is involved in the business or not, there is a chance that they’ll want a portion of the business’s value. Be prepared to negotiate. You may be able to exchange other assets, such as property, vehicles or artwork, which your spouse would take in exchange for not taking a share of the business. Be willing to consider all the options if you want to maintain full control of your business.
These are some tips to help you protect your business as you go through divorce. Every case is different, but if you’re willing to negotiate and know where you stand, you can resolve questions about ownership and property division.