Divorce is among the most challenging things anyone could ever go through, particularly if your beloved business is on the line. During a divorce, the court will divide all marital assets and this often includes business assets that will be divided among the divorcing couples.
Division of Business Assets
In New York, for instance, the court divides business assets equitably. They take into consideration what each spouse has contributed to their business while married and what each spouse might need moving forward. When courts evaluate business assets, they look beyond the immediate equitable and fair distribution and take into account your business’ long-term interests. Divorce attorneys in Long Island noted that this also includes the children who might benefit from the business in the future.
The court must first determine what marital and separate property is. In general, a separate property comes in four distinct types: gifted property, inherited property, property obtained before the marriage, as well as property designated as separate property as stated in a valid post-nuptial or prenuptial agreement.
All assets obtained during marriage are considered marital property, so they are subject to property division when you divorce. Business or corporate assets obtained before your marriage would be categorized as separate property, except for any appreciation or increase in value it has gained during the marriage. That will be considered marital property. Therefore, the court could also choose to subject this increase in value to equitable or equal distribution.
Can I Protect My Business?
While your business should not suffer just because you and your spouse have decided to divorce, unfortunately, it sometimes happens. When trying to determine how a business should be divided during a divorce, business valuation is crucial and if your business is not protected by a post-nuptial or prenuptial agreement, it might be in trouble.
Consult a divorce lawyer to see if you could protect your business and what options are available to you. If you want the equal separation of your assets, it’s best to seek their help.