High-asset divorces come with some very complex considerations. When one of the assets you own is a business, you have to ensure that your business is protected in case you divorce. There are some very specific ways that you can protect your business. Many of these must be in place before you think about divorce. In some cases, you might have to start protecting the business before you even get married.
Signing a prenuptial agreement is one of the obvious ways you can protect your business. This must be done before you get married. When you do this, you have to ensure that what you are stipulating in the prenuptial agreement is being done in accordance with the law.
If you are starting a business and think that you might eventually get married, you might need to consider transferring assets into an irrevocable trust. Before doing this, you need to ensure that you are doing so in accordance with the law. In some cases, that transfer might be voidable up to seven years from the date of transfer.
Another consideration you have is what will be classified as separate property. In general, separate property is the property you acquired before the marriage. There are also some other types of property that are considered separate property. When you have separate property, you must ensure that you don't allow it to mix with marital property. This means your business assets have to be separate. Even adding your spouse's name to a business banking account can change that account from separate to marital.
California is a community property state, meaning that marital property is divided 50/50 between the spouses. This makes it vital that you protect your business in a way that is legal and will be honored in the event of a divorce.
Source: Inc. Magazine, "How to Protect Your Business in a Divorce" Jeff Landers, accessed Jan. 29, 2015