Small businesses in America account for a substantial amount of the workforce and businesses in the U.S. economy. Many small businesses are family-owned, with many owned together by married spouses with other family members.
When the primary owners of a family business go through a divorce, the implications can be tremendous. Therefore, with so much at stake with a family business, couples who co-own a business should consider a prenuptial agreement (premarital agreement). Such an agreement can identify which property should be considered a spouse’s separate property and which should be counted as marital property, or it can deem that the other spouse will have no interest in the family business under any circumstance.
Furthermore, if one or both spouses have an ownership interest in a larger family business that would be viewed as marital property subject to division in divorce, a prenuptial agreement — and thus subject to property division in a divorce — a prenuptial agreement can give guidance on how it should be divided in the event of divorce, when it can be sold or one spouse bought out, and under what circumstances.
In other words, a prenuptial agreement can help protect the interests of the family business which can become caught in the middle of divorce proceedings, so that the family business does not experience negative ramifications simply because of a pending divorce, such as a rushed sale of the business or, worse, the closing of the business.
Divorce is a complicated and emotional process, and when a family business is involved, the process is substantially more emotional and complicated. Use of prenuptial agreements is one tool to help avoid future pain and problems that might occur in the event of a future divorce. A family law attorney can help you in that regard, for the sake of you, your family and your family business.
For further information or to schedule a consultation with Orange County divorce attorney Gerald Maggio of The Maggio Law Firm, please call (949) 553-0304 or visit www.maggiolawfirm.com. The Maggio Law Firm is an experienced divorce and family law firm serving the Orange County and Riverside areas and neighboring counties, serving clients with legal issues including divorce, legal separation, prenuptial agreements, divorce mediation, and other family law issues.