For Florida business owners, protecting business assets from loss during property division is a top priority when a marriage comes to an end. This is an area where preparation can have a huge impact, and where spouses who were savvy enough to create a prenup will have a far easier time than those who chose to forego a marital contract. The manner in which a business is structured can make a difference in how it is handled during a high asset divorce, and certain structures are more advantageous than others.
For individuals who are just setting up their business, it makes sense to consult with a financial advisor on how to structure the enterprise. For example, a business could be set up as a partnership, a corporation or as a limited liability corporation. A buy-sell agreement can be put into place from the onset, which can come in handy down the road if property division becomes an issue.
It is also important to avoid commingling business and marital funds. That means taking care to never pay for business expenses from a non-business account. It also means never using business assets to cover personal expenses. By keeping business and marital funds separate, a stronger argument can be made for protecting business wealth during a divorce.
For those in Florida who did not take precautionary measures prior to marriage, there is still a chance to obtain protection. It is possible to negotiate a postnuptial agreement that outlines how business assets would be handled in the event of a divorce. Of course, waiting to broach this subject until after there are marital problems is not likely to yield positive results. Business owners who believe that there may be a high asset divorce in their future would be well served to meet with a financial advisor and a family law attorney to ensure that all assets are properly protected, so that a fair settlement can be reached if that need should arise.
Source: bizjournals.com, "How to protect your business during a divorce", Marcellus Davis, Dec. 28, 2016