A divorce could have a significant impact on your New York company. However, there are steps that you can take today to minimize the potential disruption that the end of your marriage might have on your business or your ability to earn a living.
Create prenuptial or postnuptial agreements
A prenuptial agreement allows you to determine what happens to your business in the event of a divorce. For instance, you could declare that the company is to be treated as a separate asset that isn’t subject to being divided in a final divorce settlement. It may also be possible to retain sole ownership of your organization by ensuring that it isn’t funded with money that belongs to both you and your spouse.
If the business is considered joint property, the prenuptial agreement can create a process for determining how much the company is worth when a divorce occurs. A postnuptial agreement is created after the wedding takes place and can also answer questions such as who gets the business if the marriage fails.
Create a trust for your company
When you transfer assets into a trust, the trust itself becomes the owner of those assets. Therefore, it may not be subject to property division rules in the event of a divorce. However, it is important to note that the transfer should occur long before you have reason to believe that your marriage is in trouble. Otherwise, the transfer could be nullified by a judge.
A family law attorney may provide insight into the process of creating a prenuptial agreement to help preserve your business. He or she may also help you create a trust or take other steps designed to ensure that your company won’t need to be sold or disbanded if your marriage fails.