5 Legal Considerations for Entrepreneurs Going Through a Divorce

There’s no two ways about it: divorce can be rough. It’s emotionally and physically draining, but when you’re an entrepreneur, you’ve got even more complications to consider. Your business could be at risk, but there are ways to protect it. Here are five key things to think about. 

Balance Business and Child Custody

Having kids can make divorce way more difficult than it already is. As an entrepreneur, you probably have an unpredictable schedule. Naturally, this is not the best for joint custody arrangements, which is one of the many reasons you should speak to a child custody attorney. These specialized lawyers can make sure your role as both a business owner and a parent is taken into account so you get to balance work and time with your kids. 

Know What Your Business Is Worth

The court is going to want to know how much your business is worth, so you need to be prepared. If you built your business during the marriage, it might be considered as marital property which means it may get divided. That’s exactly why it’s so important to get an accurate valuation from a reputable independent financial advisor, so you can make sure everything is fair and you don’t end up losing more than you should. 

Is Your Business Marital Property?

In a divorce, it’s not as simple as everything you own getting split between you. For example, if you started your business before the marriage, it might be considered as non-marital property. However, if your soon-to-be-ex-spouse had a hand in growing the business, it could be deemed a shared asset. The main thing here is to figure out what’s what, early doors. Did you have a prenup or postnup? If not, and there are disagreements about how or even if you should divide the business, things might get complicated. 

Handling Spousal Support With Unstable Income

If your husband or wife doesn’t have the means to provide for themselves, or if you earn a significant amount more than them, you may be required to support them financially. This can continue long after the divorce is finalized. If your income as an entrepreneur changes a lot, figuring out how to manage this can be tricky. Courts usually want to see stable and predictable income when deciding if and how much support to set, but without the regular paychecks of a 9 to 5, your earnings may swing from one month to the next. Bear in mind that you’ll need to provide documents like tax returns and business records. 

Protecting Your Business Post-Divorce

Even when all is said and done and the divorce has been dealt with, it’s no time to rest on your laurels. If you don’t already have one, think about getting a postnup or restructuring your business to limit risks in the future. 

Endnote

Divorce is rarely easy, but being a business owner comes with a host of added challenges. The key is to know your options and work with the right legal professionals. That way, you can protect yourself and your business, and have the best chance of a favorable outcome when it comes to child custody.