If you are a business owner and you are getting divorced, you may be wondering about what will happen to your divorce in the process. This is a common concern, and we have outlined some important information below. Read on to learn more.
What is the difference between separate and marital property?
In New Jersey, separate property will remain separate during a divorce. However, marital property will be divided through the process of equitable distribution. Equitable distribution means that your assets will be divided in a way that is fair to both parties, rather than being split 50/50. Separate property includes:
- Inherited assets
- Property acquired before your marriage
- Assets designated as exempt within a written agreement
Your business may be considered marital property unless stated otherwise in a prenuptial agreement. This means it can be divided between you and your spouse.
What to know about equitable distribution:
Just some of the factors that help the court determine how your assets should be divided include:
- Property value
- Yearly income
- The established financial standard of living in the marriage
- The terms of any existing child custody agreement
How is a business valuated?
In order to divide a business, the court will need to know its true value. To determine this, the court may bring in financial experts. It is important that you do not attempt to hide any assets or attempt to make your business appear less valuable than it is. If there is a suspicion of hidden assets, an IRS investigation may be launched, leading to serious legal trouble. It is important to know that if any assets are excluded, even by accident, you can find yourself in legal trouble. As a result, it is important to work with an attorney who is experienced in business-owner divorces.
How can I protect my business?
One of the best ways to protect your business is by including it in a prenuptial agreement. A prenup is a legal document that declares how your and your spouse’s assets should be divided in the event that your marriage comes to an end. You can put your business in your prenuptial agreement and outline what will happen to your business in the event of a divorce.
If you are getting divorced in New Jersey, our firm is here to help. Reach out today to discuss your case with a skilled attorney.
Contact Our Experienced New Jersey Firm
We are a full-service divorce, family, and real estate law firm in Mountainside, New Jersey. For strong legal representation in all of your divorce or family law matters, contact Ross and Calandrillo, LLC today.