From a financial perspective, there’s a lot at stake in a divorce. This may be especially true if you own a business. Given that Louisiana is a community property state, you may be worried that your business will be evenly divided with your spouse once your marriage dissolves. This could be the case, but there are ways to protect your interests in your business.
Ways you can protect your finances and your business
To start, it’s important to note that even if you owned a business prior to marriage, your spouse will have a community property interest in any equity that is built during the course of the marriage. This is why many people who own a business choose to enter into a prenuptial agreement prior to getting married.
If it’s too late for you to do that, don’t worry. While you might be able to enter into a post-nuptial agreement, that’s not your only option when it comes to protecting your interests. One thing you can do is pay yourself a fair wage. A lot of business owners don’t do this. Instead, they invest their money back into the business, which makes it look like they’re not supporting the family household. This leaves the door open for your spouse to argue for a greater share of the business when it comes time for divorce.
Another option may be to negotiate for sole ownership of the business by giving up other assets. You’ll want to be careful here, though, making sure that you’re not putting yourself in a financially difficult position. The same is true if you decide to straight up buy your spouse out.
If it ends up that you divide your business evenly with your spouse, then you can either sell it and split the proceeds or continue to own it and share the profits. If you choose the latter, then do your best to distance your former spouse from the business.
Develop the divorce strategy that is right for you
As you can see, there are a lot of ways that a business can be handled in a divorce. Extrapolate the number of options here to every other divorce legal issue and the matter can become overwhelming. Don’t get too stressed out, though. After all, competent legal professionals like those at our firm stand ready to help you build the competent divorce strategy that is right for you.