A divorce affects every aspect of your life: social, emotional, and physical. Divorce can even disturb your business. Your small business is one of your most important assets. Know how to protect it.

Here’s a common scenario: you marry your spouse when your business is worth $100,000. You file for divorce 20 years later. Your business is worth $10 million now. The business is your own, but your ex-spouse has some stake in it. It may be too late for the prenuptial, but you can still take steps to protect your business from divorce.

Keep All Finances Separate

Keeping your family and business bookkeeping separate is more than just good business sense. It could also help save your enterprise.

Pay Yourself Well

Give yourself a good salary to keep your family afloat. Funneling all of the money into retirement may seem like a good idea, but remember that your soon-to-be ex-spouse might have a claim to it in a divorce. Funnel all of your extra cash back into the business, and your spouse may have a better legal argument for keeping a stake in it.

Ease Your Spouse Out of the Business

It may seem cruel to fire your spouse. It makes good business sense if you’re headed for a breakup. Soon-to-be ex-spouses have more of a stake in a company when they’re involved for longer periods of time.

Divide business assets cautiously. Sacrifice homes, vehicles, and other things to maintain 100% ownership of your business.

Put Your Business in a Trust

A business in a trust is no longer considered an asset. If you don’t personally own it, it won’t be subject to property division. Talk to a business lawyer to see whether this is an appropriate move for you.

Take Preventive Measures

We can’t always predict the future. If you’re getting married, consider taking preventive measures to protect your business, such as signing a prenuptial. You could sign an early postnuptial in the alternative. Judges can view postnuptials skeptically, depending on circumstances. Consider a buy-sell agreement if you’re uncomfortable with prenuptials or postnuptials. A buy-sell agreement details what will happen to a company in the event of a divorce.

Print:
EmailTweetLikeLinkedIn
Photo of Jason C. Brown Jason C. Brown

“I used to handle commercial litigation downtown, but it wasn’t very fulfilling. As Minnesota family law attorneys we have the privilege of helping people during one of the most challenging times they will face. This stuff really matters to our clients – and…

“I used to handle commercial litigation downtown, but it wasn’t very fulfilling. As Minnesota family law attorneys we have the privilege of helping people during one of the most challenging times they will face. This stuff really matters to our clients – and to us. We take pride in helping people move forward with their lives.”

Jason founded the Brown Law Offices, P.A. He has received national media attention for his work in the area of divorce and family law.

Jason Brown founded the Brown Law Offices, P.A., after clerking for the (now retired) Chief Judge of Minnesota’s Tenth Judicial District. He is an experienced trial lawyer, who handled a wide variety of cases (including civil commitment, criminal defense, probate, personal injury and commercial litigation) early in his career.

Today, Jason’s practice is dedicated exclusively to divorce and family law matters. He has successfully litigated against some of the more recognized family law attorneys in the Twin Cities. He has been named a “Super Lawyer” by Thomson Reuters, and one of the Top 100 Family Law Attorneys in Minnesota by the Society of Legal Advocates.

Jason is the former chairperson of the Family Law Section of the Minnesota Trial Lawyer’s Association, and taught divorce and family law coursework within the paralegal program at North Hennepin Community College. He publishes the Minnesota Family Law Blog, which has been recognized as a “Top 25″ by the Minnesota State Bar Association.

Local media appearances by Jason include WCCO Radio, KARE 11 Television, Fox 9 Television and WCCO Television. His national media appearances include NBC News, Time Magazine, USA Today and the Huffington Post.

Jason obtained his B.S., magna cum laude, from Minnesota State University, Mankato, and his J.D., cum laude, from the William Mitchell College of Law in St. Paul. While in law school Jason was a published staff writer and associate editor for the William Mitchell Law Review.

In addition to his work as a lawyer, Jason serves as a mediator, and court-appointed early neutral evaluator, in divorce and family law cases throughout Minnesota.

Outside of the office, Jason plays the bass guitar and serves on the Board of Directors at Northgate Church. He and his wife, Cynthia, also an attorney, have two boys.