New Jersey business owners whose marriages end in divorce might find themselves having to negotiate ownership of their tech business with their ex-spouse. The options here might require selling the business or having to continue working with their ex-spouse. However, there are some things entrepreneurs can do to protect their business before, during and after marriage.
Before the marriage
If your tech business was established before the marriage, you might ask your future spouse to sign a prenup that clearly identifies individual assets and liabilities to be kept separate in case of a split. Both parties must reach an agreement for the prenup with separate lawyers to draft it.
After the wedding takes place
If you are already married, there are several things you can do to protect your tech business in case of a dissolution of marriage. One option is to draft and sign a postnup, which works similarly to the prenup by identifying the separate property and liabilities for each spouse. Other things you can do include:
- Keeping the business and family expenses separate during the life of the marriage
- Receiving a fair salary from the business to ensure a certain quality of life for your family
- Maintaining your spouse outside the business so that they cannot argue that they played a role in it
- Creating a domestic asset protection trust so that the trust becomes the owner of your tech business
- Dividing the family bank account between you and your ex-spouse to show that your assets are completely separate
If you do begin the divorce process without any of the above actions, you might try to keep the business in exchange for other marital property, such as the family home. You might also work out a plan with your ex-spouse to buy out their part of the business over time. Your attorney may help you evaluate your options.