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Understanding what divorce means for spouses who co-own a business

Divorce is never easy and often when a business or other assets are involved the issue becomes even more clouded. Though a quick resolution is always best, it may become necessary for both parties to have legal representation to help smooth over any issues and make for a much easier transition from married life to divorced life.

There are plenty of considerations when it comes to divorce with those that have a business to consider, and knowing what to expect can truly make a big difference in the overall success of proceedings. For example, the first thing that you need to consider is the ownership of the business.

In many cases, those that are the sole proprietor of a business prior to marrying someone will have some sort of safeguard or ownership deal worked out as soon as they are married or immediately before. This helps to protect both parties in the event that the marriage fails. Things like prenuptial agreements or even allowing your new spouse to become part owner are all things to consider. Ownership is going to be a big part of dividing the assets and settling in the case of a divorce.

Who owns the business after the divorce?

The next issue to contend with is to determine business ownership rights after the divorce is concluded. Will the business be sold and the money divided, will one member of the relationship keep ownership and buy the other out, or will both stay in the business? These are all possible scenarios that are best discussed with the help of a skilled family law attorney.

Other important considerations

If there was a prenup in place that contained language concerning the business, what happens when the parties jointly contribute assets to the entity after marriage? Say for instance that a man owns a business and his wife signs an prenup before marriage. This will protect the business as it stands at that time. If his wife helps to improve the business or make more money for it she may be entitled to a portion of the business or monetary compensation after the divorce is final.

Divorce is not simple by any means even if both parties agree on terms prior to ever sitting down with a lawyer to go through with the proceedings. With the right representation you can come to an agreement that allows you to be certain that your property rights are protected at all times.

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