Is Your Miami Business Protected During a Divorce?
When a couple divorces in Florida, their shared marital assets are split as part of the divorce proceedings. Florida is an equitable distribution state — this is not to say that assets must be divided equally, but that the courts are concerned with distributing assets fairly and equitably.
When determining if a Miami business is subject to property division, it is necessary to ascertain whether it is a separate/individual asset or a marital asset. Determining which assets are shared and which are separate is a complex process that requires a thorough evaluation of all a couple’s assets and debts. This is when retaining the services of a top Miami federal lawyer can be helpful.
Frequently encountered issues when determining whether a Miami business is a separate or marital asset include the following:
- When and by whom was the business founded?
- Who financed the business, and with what assets?
- Have business and marital assets ever been commingled?
- How did both parties contribute to the business?
- Any prenuptial or postnuptial agreements that deal directly with business management.
If you own or have a share in a Miami business and file for a divorce, you must consult with an experienced divorce attorney in Miami, FL. While most non-marital assets will not be divided, this may not always be the case, and you could be at risk of losing your business.
The most common ways of dividing businesses during divorce proceedings
Given that Florida does not require equitable distribution of marital assets, the couple can work together to divide their marital assets fairly while perhaps keeping some bigger assets — like a business — intact. For example, one party may assume a greater share of the marital debt in exchange for the business’s retention. How a business is divided will also depend on its valuation and structure.
Keep your business assets separate from your marital assets.
Whether you own the Miami business or are a shareholder, if it is determined that it is a marital asset, your former spouse could be awarded shares in the business. Avoiding the commingling of business and marital assets is one of the best ways to protect your business interests. Furthermore, if you own or are involved in multiple business ventures, you should keep all of your business funds separate and well-organized. Commingling your assets complicates determining whether a business should be regarded as marital or separate property.
Establishing a prenuptial agreement before marriage and a postnuptial agreement after marriage are two of the most effective legal strategies for protecting your business in a divorce.
While the idea of pre-marital agreements is not romantic, preemptive planning is critical for protecting your business interests. Contrary to common assumption, entering into a prenuptial agreement does not imply a lack of trust in the marriage. On the other hand, it is an excellent opportunity for a couple to be on the same page financially and to establish a mutually beneficial plan should the unexpected occur.
Consult with a Miami divorce attorney!
If you own or have a share in Miami, you should consult with an experienced divorce attorney about protecting your business during your divorce proceedings. Although it may seem unromantic, there is no such thing as a guaranteed future. Being prepared will effectively protect your business interests and save you and your spouse a great deal of stress if you ever decide to divorce.