Dealing with the family business in a New York divorce

Going through a divorce is hard enough without extra financial-based hardships, but many successful business people must deal with more than a fair share of these burdens when divorcing. As touched on in a recent blog post, couples that co-own or share financial interests in a family business quickly learn about these often-surprising hurdles early in their divorce process. As New York is the nation's most active business district, divorcing couples in this state find themselves struggling through the process of handling a family business, but the law can help them approach the problem fairly.

Probably the best way to avoid the complications that go hand-in-hand with dealing with the family business through divorce is by creating a business prenuptial agreement. Of course, it is best to do this before getting married, but what about those who create a family business after they are married. In truth an agreement detailing how the business will be dealt with upon divorce can be created at any point in the relationship. With such a legal document in hand, the process can be greatly simplified for both parties.

Things to consider include:

-- Whether or not one spouse can buy the other spouse's controlling interest in the business-- Whether to sell the business outright and divide the profits equally-- Whether or not it will be possible to continue jointly operating the business after divorce

Having these types of legal agreements in place well before marriage troubles appear on the horizon is typically a good arrangement for everyone involved. To get started, couples should consider working with an attorney familiar with helping spouses deal with the business side of divorce in New York.

Source: MainStreet, "Who Holds onto the Family Business When Couples Divorce?" S.Z. Berg, Feb. 10, 2015

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