Are you a business owner facing divorce in Michigan? If so, you probably have a lot of questions about whether or not it is possible for you to keep your business intact through the divorce settlement.
The reality of the situation is that, without a prenuptial or postnuptial agreement, your business probably qualifies as marital property, and therefore may face asset division like the rest of your marital property.
However, if you make preserving your business a priority and begin building a strategy with an experienced attorney very quickly, it is possible to keep the business afloat.
Each scenario is different, so it is vitally important that you get professional help. Without a strong plan and decisive action, your business may not make it through to the other side of this difficult season.
Make sure the business is separate from the family
It is crucial to keep your business and family matters as separate as possible. Any cross pollination between your family assets and you business assets will give your spouse further ammunition to claim that he or she deserves a share of the value of the business.
This means you must keep very clear records for your business and avoid using funds from one for the needs of the other. Avoid using the business’s funds to pay for things at home, or using money from your own salary, savings, or equity to pay for business needs.
Similarly, you absolutely must sever any involvement your spouse has with the business. If your spouse helps out in any way, and especially if he or she has some kind of formal position within the business, this must stop immediately. This may mean that you must fire your spouse.
Know the true value of the business
It is difficult to fight to keep your business intact when you do not know what it is actually worth. If you cannot determine easily the exact value of your business, you probably need to enlist the help of a private business valuator.
Once you have a clear picture of the business’s worth, it is easier to fight to keep it. This way, your spouse cannot claim that the business is worth more than it actually is and take you to the cleaners in the process.
Offer other assets to keep the business off the table
A likely scenario when fighting to keep a business is that you’ll need to essentially buy your spouse out of his or her share of its value. If you have enough liquid assets, you may be able to simply write a one-time check and be done with it.
However, for most people, this entails a delicate negotiation involving various other marital assets such as real estate, vehicles, savings accounts, retirement accounts and investments.
While it is never easy to give away these things that you worked so hard to build, with your business intact, you can begin rebuilding immediately once your divorce finalizes.
Don’t wait to build a strong strategy
If you want to save your business from your divorce, you must act immediately. Do not wait to reach out to an experienced Michigan attorney who understands how to protect your interests and keep your business together.
With proper legal counsel, you can ensure that your rights remain secure as you walk through this difficult season and into a fresh start on the other side.
Source: Nov. 30, -0001