Virginia law says that marital assets need to be divided equitably in a divorce. Therefore, if your business is considered to be a marital asset, you may lose some or all of the company that you built. Fortunately, there are steps that you can take to prevent this from happening.
Your spouse may accept a buyout instead of taking control of your business. An insurance policy may cover some or all of the cost of doing so, so you don’t have to undermine the company’s financial position. This means that you won’t have to worry about upsetting shareholders, not paying vendors or getting rid of employees because you chose to end your marriage.
Consider a trust
A trust helps to keep your business outside of the marital estate. Therefore, you won’t be at risk of losing your company regardless of what your spouse wants or tries to do in divorce court. You can also protect your business by creating a prenuptial agreement stating the company remains in your control in case of a divorce. If you create the business after marriage, you can add such a stipulation to a postnuptial agreement.
A divorce can have a significant effect on everyone who is associated with your business. Therefore, taking steps to protect your firm before starting divorce proceedings may ensure that your brand stays intact no matter what happens to you. This is because ensuring stability at the top can put customers, investors and others at ease, knowing that you will still be in business over the long term.