When a couple has been married for two or more decades, divorce can include some complex matters. Divorce preparations must consider homeownership, a growing retirement fund and children preparing for college. If one spouse owns a business, this adds even more complexity to the negotiations.
New York is an equitable distribution state, and there is every possibility that the business will be on the table as a marital asset to split between the spouses. After decades together, marriage partners may not give a thought to what they own separately and what they share. Those matters are vital when it comes to divorce, and they are especially critical in high-asset situations involving doctors, engineers, entrepreneurs, etc.
Protecting the business
Whether one spouse started the business before or after marrying, or it was inherited from family members, it may be difficult to separate the business from personal assets after a long marriage. Spouses who have been unable to keep the profits and debts of a business separate from their personal accounts may benefit from taking the following steps:
- Gathering and organizing the business’ financial information, such as taxes, receipts, invoices and bank accounts
- Seeking the advice of a financial professional
- Removing the spouse from the workings of the business if he or she is not a co-owner
- Separating business accounting from personal finances
- Obtaining an impartial valuation of the business
To avoid having to sell the business to split the assets with a divorcing spouse, a business owner may have to do some difficult negotiating. This could include sacrificing other assets to maintain ownership of the business and keep it intact. A skilled attorney with experience handling divorces for business owners may prove invaluable.