Entrepreneurs who pour their heart and soul into building a successful business often worry about protecting it during a divorce. Divorce is never easy. However, they become more complex for high-income individuals as they have substantial financial assets to deal with during property division. As such, it can be challenging for high-income couples to reach an agreement on the terms that will apply to the termination of their marriage. If you’re facing a high-net-worth divorce, contact an experienced Nassau County High Net Worth Divorce Lawyer who can help ensure you don’t settle for less than what you deserve. Please continue reading to learn how to protect your business’s interests during a high-net-worth divorce.
What is a high-net-worth divorce?
A high-net-worth divorce differs from a traditional one as it involves couples with high-income brackets and significant financial holdings. Generally, this type of divorce refers to couples with a combined net worth of 1 million dollars or more in liquid and non-liquid assets. However, nowadays, a million dollars is not what it used to be. As such, it is more accurate to define high-net-worth divorces as those involving couples with multiple millions of dollars at stake.
How can I safeguard my business during a high-net-worth divorce?
Understandably, after years of hard work and dedication toward building a successful business, you may be worried about protecting it during a divorce. New York is an equitable distribution state, which means marital assets; any assets accumulated during the marriage will be divided equitably between both parties. For some couples, this could mean a 50/50 splot of marital property. However, what is deemed a “fair” division of assets is up to the court’s discretion. For other couples, this could mean an unequal distribution of marital assets. Therefore, if your business was acquired during the marriage, it will be considered marital property, subjecting it to equitable distribution.
To shield your business from the impact of divorce, you should consider creating a martial agreement. Before you tie the knot, you can draft a prenuptial agreement. This legal contract allows you to clarify asset ownership and essentially stipulate who gets what if the marriage crumbles. You can define the property stake of each spouse and dictate whether it is separate or marital property. This will help you determine what qualifies as marital property and should be subject to equitable distribution. If you want your business to be considered separate property or devise an arrangement in which you retain ownership shares, you can do so through a prenuptial agreement. Even if you don’t create a prenuptial agreement, you can draft a postnuptial agreement, as it can safeguard your assets like a prenuptial agreement.
Furthermore, you may consider creating a formal agreement or business succession plan. With a formal arrangement, you can create ownership shares and buyout agreements based on fair value among the business owners. You could also devise a business succession plan where you can outline potential successors, their roles and responsibilities, and even create a roadmap to transition ownership and control, which can help ensure the long-term stability of your enterprise.
If you’re a high-income individual considering divorce, you need a skilled Nassau County high-net-worth divorce lawyer. At the Law Offices of Eyal Talassazan, P.C., we are prepared to fight on your behalf to safeguard your hard-earned assets and business interests.