5 Ways to protect your business from divorce.


Your marriage is ending, but business is booming. How do you protect your business from your soon to be ex-spouse? You have worked so hard, and you don’t want to lose your business, or even worse, have your ex as a partner in it. Can you imagine the arguments? If you feel this way, you could very well be wondering, “how can I protect my business from my divorce.” Many people wonder the same thing. According to CompleteCase, almost half of the marriages end in divorce in America. Many of these couples own their own businesses and there are many lawyers who are more than equipped to help you protect your business during a divorce. According to circumstances, your spouse might be able to get half of your business. This will depend on when you started your business. If you started your business during your marriage, it will be viewed as a marital asset, therefore it could be split between you and your ex.

When it comes to having a business and getting a divorce, it is extremely important that you have certain protective measures in place before you even think of getting a divorce. A prenuptial agreement is always so important to have before you get married.

Here are 5 ways to protect your business from divorce.

1.Have a prenuptial and postnuptial agreement in place

As mentioned earlier a prenup is incredibly important. This is an agreement that the couple signs before their marriage which states what will happen to their assets if a divorce ever had to occur. It will detail property rights as well as what expectations would be upon getting a divorce. A prenup should be handled by an attorney, and a document will be drafted and signed before the wedding. Both parties should be present at the prenup and it should be done a while before the wedding so that it is signed and written with both parties thinking logically and clearly. The prenup should be signed in front of a notary or a witness. Another important aspect of a prenuptial agreement is that you have to have full disclosure about your assets. If you lie in your prenup, then this could cause it to become invalid. By signing a prenup you can decide which property will be viewed as separate; so if you have a business before your marriage, you can write that it will be viewed as a separate asset and not a marital asset. You could even decide how marital property will be divided in the case of a divorce. By signing a prenup, this is the best way for you to protect your business. Not only will it save you money in the future, but it will make the entire divorce process less complicated legally speaking.

If you never had a prenup agreement in place, you might also have the option of a postnuptial agreement. Many judges might view this as sketchy, but nevertheless, you can do this. A postnuptial agreement should be signed soon after you get married or at least several years before a divorce happens. A postnup will also have to disclose all the same information as a prenup, the only problem is that a postnuptial is not as ironclad as a prenup. The reason being is that as a married couple your legal rights are now very well defined. You would then have to act in the best interests of the other party.

  1. Put your company in a trust, a partnership or use buy-sell agreements

By putting your business in a trust, a partnership or by using buy-sell agreements, you will also be protecting your business, if you had to get a divorce. These provisions protect the other owners of the business, in case one had to get a divorce. Don’t make your spouse a partner in your company, as this could really complicate things, if you ended up getting a divorce. Even if you think it’s a good idea for tax reasons, rather don’t do this. You could always make your spouse a secretary in the company rather than a director. Even if your spouse had no input in the business, they could use the fact that they were a “director” in the company to their advantage. You could also state that each partner in your business would have to agree to all the terms in case one partner had to get a divorce. You can see how this will protect your business during a divorce.

  1. Make sure to pay yourself a competitive salary

Another way in which you can protect your business is by giving yourself a decent salary. You’re soon to be ex could state that you used the family money to grow your business, instead of using it towards the family. Your ex could state that they are entitled to a greater percentage of your business for this very reason. Therefore if you pay yourself a decent salary, you could then say that you did not use family money to grow your business.

  1. You could always “pay off your spouse”

If your spouse is entitled to shares in your company, you could always pay them off, so that the business will be entirely yours. You could pay them off for example by giving up some other assets of yours. You could give them the marital home, in exchange for the business, or other marital property such as cars or retirement plans. You could also always sell the business and divide the sales price. Or you could pay your spouse a monthly amount that would help you buy out their share of the business.

  1. Don’t involve your spouse in your business.

If you can, before you start your business, do not involve your spouse in your company. The less they have to do with your business, legally the less foot they will have to stand on when it comes to having shares in your business, or a large percentage of your business. The more involved your spouse is in your business, the higher the percentage they will be able to claim in your company. Therefore keep their involvement to a minimum or keep it to nothing at all.


You have worked hard for your business. You deserve to have the main say as to what happens to your company. When it comes to protecting your business during a divorce, the best thing to do is have a prenuptial agreement before you get married. Whenever it comes to getting a divorce, it is always wise to speak to a lawyer first with regards to any business or assets that might have to be split during the divorce proceedings. You never want to make such large legal decisions without a lawyer present. If you follow these tips, then the chances of protecting your business are greater.


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