According to a report conducted by the National Marriage Project at the
University of Virginia, 50% of all marriages in America end in divorce.
With this in mind, it is important for business owners to know how to
protect their company if they are going through a divorce. If business
owners aren’t careful, they can end up battling to keep their business
assets from their ex-spouse. In this blog, we explain a few ways that you can
protect your business in a divorce.
LLC’s & Corporations
One way to protect your business assets is to make a limited liability
company. LLC’s run under an “operating agreement” which
details the ways decisions are made for the business. Assets like real
estate and bank accounts can be titled in an LLC. This can potentially
shield these assets from being labeled as personal assets in a divorce
proceeding. LLC’s created prior to the marriage usually provide
better asset protection.
Creating a corporation like a c-corporation or an s-corporation is another
way to protect your business assets from your spouse. A corporation is
a separate legal entity from you as an individual and can hold your business
assets. You should consult with a lawyer to determine what type of corporation
is best for your situation.
Create a Trust
Another way to shield your assets is to make a trust. Like corporations
and LLC’s, a trust is a separate legal entity that can hold your
real estate and bank accounts. You can legally transfer your business
assets to a trust to protect the business. Creating a trust requires proper
documentation that is best handled by an experienced attorney.
Do you need help protecting your business assets from your ex-spouse? Contact our Birmingham divorce attorney
to set up your free consultation today.