You realize that people in Iowa and elsewhere divorce all the time, but you feel uncertain about navigating divorce as a business owner. What special considerations must you make to protect your company?
Business.com offers advice for divorcing entrepreneurs. Even if you and your soon-to-be-ex-spouse did not sign a prenup, you still have options for protecting your business.
Offer alternate assets
Maybe you already anticipate your current spouse looking to take a chunk of your business in the divorce. If so, consider offering other assets. That way, you retain full ownership of your company.
Sell your business
If you feel trapped in an inescapable business situation with your soon-to-be-former-partner, think about selling your business. You may prefer to offer your current company to someone else and start something new from the ground up. Know that the proceeds you make from selling likely count as marital property to divide in your divorce.
Sell your stake in the company
Instead of selling the business entirely, would you feel more comfortable selling a stake in the company to honor your divorce settlement? Talk to your employees or partners about selling them a percentage of your stock so you have access to a lump sum for your divorce agreement. Later, you could buy your stock portion back.
Offer incremental payments
Between the cost of divorce and your other financial obligations, you may not have much money to devote to a divorce agreement. If not, gauge your current spouse’s interest in receiving incremental payments. That way, you honor your divorce agreement without putting your business at risk more than necessary.
You do not have to lose your business in a divorce. Knowing your options protects your investment of time, money and energy.