Married couples don’t often consider what may happen if they decide to file for divorce. However, considering this early in your marriage can help prevent issues with your business if the time comes when divorce is on the horizon.
The possible negative effects of divorce on your business are wide-ranging. Understanding what these are can help you prepare and mitigate issues for your business in the future.
Filing for divorce can impact “business as usual.” Your business requires a lot of time and attention. Filing for divorce requires the same level (or more) of attention. You must take time to go to court, speak to legal representatives and handle other aspects of the divorce. This means you take a significant time away from your business.
Also, your business must be valued and divided if it is considered marital property. This may also result in employees spending time away from their usual business tasks.
Impact on partners and employees
If your business is part of the property division process in your divorce, you must consider how it will be divided. One option is to pay your spouse with stock shares. However, if your spouse has a larger share of your business than you, they may become an uninvited partner, which can impact other partners. Your spouse may choose to sell their shares at some point, which puts an unknown in a partnership position.
Handling business-related concerns in your divorce
The impact of a divorce on your business can be significant. It’s important to understand what may happen and take steps to mitigate the impact on your business. While planning for this situation is best, you still have legal options if you haven’t made a plan.