Divorces Involving a Business in Indiana
If you have built a business, you may feel it belongs to you alone. In a divorce, however, a business may be considered a joint marital property and divided between the spouses. Your business may be your most valuable financial asset, involved considerable resources and countless hours of your time. If you are facing a divorce, it is important to have an experienced divorce lawyer by your side to protect your interests early in the process.
At Trapp Law, LLC in Indianapolis, IN, we are experienced in handling divorce cases involving business ownership. We understand the sensitive nature of divorce and are committed to protecting your best interests. Our Indianapolis attorneys specializing in divorce know what is at stake in a divorce and will take every possible measure to avoid a contentious future with your ex-spouse. Call to schedule a free initial consultation if you are a business owner facing divorce.
Is My Business Subject to Division in a Divorce?
In most cases, a business will be considered marital property and subject to property division in a divorce. This is true whether you acquired your business before or after your marriage.
Indiana is an all property, equitable distribution state. This means that all property owned or acquired by either spouse before or during the marriage, or assets acquired by the joint efforts of both spouses, are considered marital property and subject to division. One of the few exceptions is when a business is excluded from division under the terms of a proper prenuptial agreement.
Can a Prenuptial Agreement Protect My Business?
Ideally, the business owner and fiancé will have thoroughly addressed issues of ownership and control of the business in a prenuptial agreement before they married. If this is the case, there may be no room for dispute in a divorce.
However, not all prenuptial agreements are ironclad. There may be issues that were not anticipated before the marriage and not addressed in the agreement. Your spouse may have grounds to argue that the prenuptial agreement is unenforceable. If you have a prenuptial agreement, have your attorney review it as one of your first steps in preparing for divorce.
How Is a Business Valued in a Divorce?
Before a business can be equitably divided, it must be accurately valued. This can be a complex and time-consuming process. The process often begins with a qualified appraiser’s inventory of tangible property, including buildings, machinery, inventory, office equipment, and cash. The value of a business includes:
- Tangible property
- Intangible property
- Assets
- Liabilities
Designing a Strategy for Divorce Involving a Business
Unless you have an ironclad, enforceable prenuptial agreement protecting your business, it is likely to be subject to division in a divorce. The sooner you meet with an experienced divorce attorney to develop a strategy, the better.
Questions to consider in developing a divorce strategy include:
- How invested is your spouse in the business? Will he or she want to play an active role or maintain an ownership interest?
- What assets are you willing to give up in a divorce to secure sole ownership and control of your business? The presumption under state law is the marital pot should be split 50/50. You will likely need to relinquish other assets in negotiating for outright ownership of the company.
Our Indianapolis divorce attorneys at Trapp Law, LLC understand that no two cases are the same and develop creative and custom solutions to resolve problems related to business ownership in a divorce. Contact us to learn more.