How divorce can impact a business

How divorce can impact a business

On Behalf of | Jan 6, 2022 | Divorce |

The process of divorce in New York no doubt affects multiple aspects of a person’s life, including his or her business. However, it is possible to get through the divorce process with one’s business intact with a little preparation and foresight. Here are a couple of ways in which divorce impacts business, as well as how divorcing individuals can protect their best interests during their marital breakups.

Partnership impact

A divorce may change a business’ leadership or ownership structure significantly. For instance, perhaps a husband and wife co-owned a family venture and operated it together. The wife’s departure may leave the husband with an immense boost in responsibilities. As a result, the husband might need to find a new partner who can help with operations and governance. Alternatively, both the husband and wife could decide to keep working together professionally, in which case they might want to create a more formal partnership agreement outlining their responsibilities and how they will resolve future disputes.

Asset impact

Divorce may also impact a business through property division. As a general rule, if one of the spouses owned the business before the two parties got married, the business will remain his or her property. Meanwhile, any business acquired in the course of the marriage will be deemed a marital asset, which means it will be subject to asset distribution in the divorce proceeding. In this case, a judge will decide on the most equitable way of dividing the business’ assets between the two parties.

Seeking the help of an attorney

Dealing with the division of business assets and other property during divorce can understandably be complicated from a legal and financial standpoint. However, an attorney in New York can help a divorcing individual to pursue a comprehensive and fair settlement agreement with the other party through mediation. The attorney will ensure that the client’s rights and best interests are protected during all stages of the divorce proceeding.