For all of the struggles you have encountered as a small business owner in Westminster, protecting your business from your spouse likely was not one that you anticipated. Yet that is exactly the position that many of those that come to see us here at The Law Firm of Lan Quoc Nguyen & Associates are placed in when they choose to divorce. If and when you and your spouse dissolve your marriage, each of you is entitled to an equitable share of your marital assets. Your business may be included among them.
Yet if you started your company prior to marrying your spouse, you might wonder how, then, could it be viewed as a marital asset? Technically speaking, any asset or property from which both you and your spouse benefit from is considered to be part of the marital estate. So, in the aforementioned case, your business itself may not be viewed as a marital asset, yet the profits that you make from it during your marriage (plus any increases in value it experiences during that same time) are subject to property division.
According to the online publication Inc.com, a simple way to prepare for the potential of having to protect your business assets in the event of a divorce is to pay yourself a salary. Many small business owners want to put whatever money they make right back into their companies, yet doing this comingles business and personal assets and gives your spouse a stronger stance in arguing that they never adequately benefitted from your business. Allowing them to benefit directly from a salary may prompt the court to exclude your business assets on the grounds that your spouse already has derived benefits from them.
More information on protecting assets during your divorce can be found here on our site.