When a business owner ends a marriage, it can be a tumultuous and vulnerable time for the business. West Virginia entrepreneurs and their business partners should openly discuss financial risks, including divorce, at the onset of starting a business and on an ongoing basis as they grow or restructure their holdings. It can be helpful to include one’s business partner in some conversations surrounding property division, as the results could impact them and they should be informed as to how vulnerable the business is in a divorce.
A lot is at stake in a divorce for business owners; the spouse could take half of an ex’s share in the business and essentially do whatever he or she pleases with those shares. However, the details of how that scenario may play out can vary depending on the business. In some cases, this would require the dissolution of the business to calculate the assets and liabilities so the spouse can take his or her share. Those who wish to avoid this scenario may benefit from a prenuptial or postnuptial agreement that covers this potentiality.
An uncontested divorce, if possible, is one way to minimize the impact on a business. In an uncontested divorce, both parties requesting the divorce have mutually agreed to the terms of the divorce. If this is not a possibility, the business owner should be prepared to defend the shares of the business in court. In either case, the individual may consider making giving up something else in the divorce to protect that business asset.
There are many legal details involved in a divorce that includes a business. Business law, tax law and, most importantly, family law are all in play in these cases. It is therefore critical to have a West Virginia family lawyer on hand as one works through the property division in these cases.
