How do I keep my business safe in a divorce?

Splitting up assets in a divorce is always difficult. But if you are a business owner, the process becomes that much more complex. You will have to decide the best way to split your marital assets while hopefully keeping your business alive and profitable.

As you and your spouse go through the process of divorce, your business will be part of your assets and your income evaluation. Here are a few tips to make sure you keep your business safe:

  • Consider a legal contract – Prenuptial and postnuptial agreements can establish rules for how a divorce will split your business. A contract can keep the business separate from divorce proceedings. It can also limit how much of the business assets the former spouse can take. A legal agreement can create defined rules for how to split the business.
  • Keep expenses separate – Your business income and expenses should remain in your business. As the business owner, you should not use your business accounts for personal expenses. Instead, pay yourself a salary that goes into your personal accounts. Any personal expenses should come from you and your spouse’s personal accounts. This separation makes sure that your business valuation is accurate and helps make the process easier.
  • Keep emotions out of decisions – Emotions run high in a divorce. But keeping your emotions and your decisions separate will help you in the long run. You may feel like your business is your own and your spouse doesn’t deserve any piece of it. But working with your spouse to reach a compromise can help protect from your spouse trying to take a larger share.
  • Find a team to help you – When you and your spouse have complex assets, you will need people to help properly divide the assets. You will need a business valuation expert to determine the value of your business. You will need your accountant to provide financial information. And you will need a lawyer to guide you through the complex division process. Having a good team can help keep your business alive after the divorce.

While getting divorced while being a business owner can be tricky, there are steps you can take to protect your business. Each situation is different, so make sure to seek help from qualified advisers.