How is a Business Divided in Divorce?
When dividing a business in a Pearland, Texas divorce, be aware of your options and the steps needed to protect your ownership rights.
Being a business owner is a lifelong dream for many people. Unfortunately, it can easily become a nightmare if you are married and going through divorce proceedings. Our Pearland, TX divorce attorney wants you to be aware of how the law applies in these situations, the options available, and ways to protect your ownership rights.
Options for Dividing a Business in a Texas Divorce
The first step in protecting your rights as a business owner while going through a divorce in Texas is to be aware of how the law applies in this situation. As a community property state, the Texas Statutes dictate that each party has an equal interest in all marital property and assets. This means that unless you started your business prior to marrying your spouse and they did not contribute in any way to it over the years, it could be subject to property division in divorce .
This is a complex matter which requires the help of an experienced Texas divorce attorney. Your specific rights as a business owner and the best course of action in your case will depend on the details surrounding the situation. The following outlines some general options for dividing a business in Texas divorce proceedings:
- Buy out your spouse’s share;
- Trade rights to other property and assets for full ownership;
- Consider joint ownership;
- Sell the business, split the profits, and start over once your divorce is final.
How to Protect Your Business Interests
When filing for divorce through the Brazoria County Court , none of the above may seem like the best option. To prevent this type of situation, put a premarital agreement in place prior to your marriage or a postnuptial agreement after. This spells out each person’s rights and responsibilities regarding business ownership and protects you in the event of a divorce.
As this may no longer be an option, take other steps to protect your rights as a business owner in divorce proceedings:
- Include stipulations in business documents that dictate how a divorce is handled;
- Keep shares of your business in a trust, which is protected from your partner in the event of a divorce;
- Get an accurate business valuation, detailing total income, inventory, and all business-related debts;
- Make a thorough inventory of all other marital property and assets, including family heirlooms and your spouse’s personal belongings, which can help in negotiations.
Discuss Your Options With Our Pearland, TX Divorce Attorney
Business owners face unique challenges when going through a divorce in Texas. To protect yourself and your ownership rights, discuss your options with Pearland divorce attorney John Powell III, P.C. We have extensive experience handling these types of matters and can advise you on the best course of action in your specific case. Call or contact us online today to request a confidential consultation.