Small business owners in Colorado know that major life events can have a major impact on their company. When you own your own business, your personal life and your professional life often overlap. A divorce will certainly impact your closely held assets, including your business, and you may find it beneficial to learn how you can protect the company you worked so hard to build.
There are various factors that could affect what will happen to your business after divorce. From the length of the marriage to when you started your company, the impact that the end of your marriage will have on your business depends largely on the details of your individual case. You have the right to protect yourself and your interests as you work for a reasonable outcome to your property division concerns.
You do not have to divorce your business
Any asset acquired or accumulated over the course of your marriage is a marital asset, and, therefore, it is subject to division in a divorce. What this means is that if you started your business after you got married or it experienced significant financial growth and profit after the marriage, your spouse could have a rightful claim to part of the business.
Every situation is different, and the specific way the end of your marriage will affect your day-to-day operations and profits will depend on various factors. Some of the things you may consider include the following:
- If there is a prenuptial agreement, this will determine how and if spouses will divide important assets, including a business, in a divorce.
- If you and your spouse signed a postnuptial agreement, this also can determine what will happen to any business assets.
- If you came into ownership of your business through an inheritance, it may not be a marital asset. If not, it is not subject to division in a divorce.
- If the business is included as part of a trust, you may not have to divide profits or split business-related assets with your spouse.
Property division is complex, and there are various factors that will affect your small business in the event that your marriage ends. Many business owners find it possible to come to a reasonable and sustainable property division settlement through out-of-court negotiations and agreements.
Protecting your property rights
You spent years building your business, and it may seem like a divorce is a direct threat to everything you worked toward. While the divorce will likely have an effect on your business, it does not mean it is the end of the road. With guidance, you can pursue a property division order that is beneficial and allows for the continued success of your business.