Editor’s Note: Haute Lawyer partner Sandy B. Becher talks about the importance of a prenuptial agreement when it comes to your business.
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Do you own your own business? Are you getting married? A prenuptial agreement (prenup) can protect your business should you ever get divorced. It might be most important for business owners whose businesses don’t have high valuation—yet. As your business grows, so will its value, and so will any claim that your future spouse might have on that growth.
If your business increases in value during your marriage, your future wife or husband could be entitled to that value in the form of community property should you ever get divorced. Any money you earn during your marriage and any increase in value to your property or business can be subject to equitable division laws. The best way to protect your hard-earned brand and company is to have a strong and sound prenuptial agreement in place—before you get married.
According to Entrepreneur, the best way to protect your business is to take preventative measures before you get married. This includes drafting a prenup that makes it clear that your business is separate property. Here, it is important to hire a qualified prenuptial agreement lawyer like Sandy B. Becher, P.A. in Miami, Florida. You’ll need to be very clear in your prenuptial agreement that the business is entirely owned by you and that you are entitled to any appreciation in value. It is also important that the prenuptial agreement be fair and clear in scope. Consider stipulating what private property your ex would be entitled to receive in lieu of the business. A judge will be more likely to see such a prenuptial agreement favorably, over one that seems tipped in favor of the business owner.
This step, however, should not be the only one you take. If your future partner will work with you on the company, pay him or her a fair and high salary and keep detailed records of your business dealings and finances. Other legal instruments you can use to protect your business includes placing the business in a trust and drafting a buy-sell agreement that stipulates what happens during a divorce or change in ownership.
If you don’t have a prenuptial agreement, there are still steps you can take if you are filing for divorce. According to Inc. if your spouse had no role in the business and did not provide business ideas, now might be the time to document this information and hire a qualified divorce lawyer to help you navigate the legal questions that may arise during your divorce. Sandy B. Becher, P.A. are Miami, Florida divorce attorneys who can review your options and goals. If you do not want to end up with your ex being a partial owner of your business, it is best to take steps during the good times in your marriage to protect your assets. However, there are steps you can take during your divorce to also increase the likelihood that you’ll have a better outcome for your business.
If you already have a prenuptial agreement, Sandy Becher can help you to either defend against challenges to the validity of your prenuptial agreement or enforce your prenuptial agreement.
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