Everyone who gets married in Pennsylvania is likely to bring their own assets and debts to the relationship. For example, it is not uncommon these days for people to have thousands of dollars in student loan debt by the age of 22, while it may also be the case that some people can expect inheritances from relatives which may boost their financial security. Unique assets and debts can quickly become commingled in a marriage.
However, when a person who owns a business gets married, protecting that business can become a concern of paramount importance. So, how can Pennsylvania residents protect their businesses in the event of a divorce?
Well, for starters, most business owners are familiar with contracts of every kind as they run their companies. Contracts can play a role in protecting business assets in a marriage, too. If the marriage is only in the planning stages, a business owner in Pennsylvania may want to consider the benefits of a prenuptial agreement. A prenuptial agreement can specifically state that the business is a separate asset that will not be part of any future divorce proceedings. If the marriage has already occurred, a business owner may want to consider a post-nuptial agreement, which serves the same purpose, but is drafted and executed after the marriage occurs.
But, if a contract doesn’t seem feasible for some reason, a business owner can also take other steps. Those steps can include: keeping the business and its finances separate from the marital assets; keeping clear financial records for the business; drafting a business arrangement that specifically states that ownership interests in the business cannot be transferred in the event of a divorce; and knowing your company’s value.