Owning and operating a successful business is a lifetime goal of many Georgia residents. Once a business is up and running, the goal shifts to preserving that success, and growing the business as time passes. For many spouses, protecting business assets from loss in the event of a divorce is a priority; others do not think about these matters until the need arises, which is often too late. The best time to shield business assets from property division losses is prior to walking down the aisle.
Drafting a clear and comprehensive prenuptial agreement is an important financial planning measure. In the case of business owners, having these protections in place well in advance of a wedding will bring the peace of mind of knowing that business assets will remain intact if the worst case scenario should occur. Many people think of prenups as being one-sided, and aimed at preventing the less moneyed spouse from achieving any financial gain in the event of a divorce. In reality, a prenup can be a very balanced document, and can provide protections for both partners.
For example, if one party already owns a business at the time of marriage, but the other party plans to actively participate in the business once the marriage takes place, a prenup might state that any business assets brought into the marriage will remain the personal property of the initial owner. Anything acquired after the marriage, however, would be subject to equal division in the event of a divorce. Couples can even agree on a percentage to be used in dividing business wealth.
Another consideration for Georgia business owners who are thinking about a prenup involves business debt. Many business ventures take on a great deal of debt as they get off the ground or go through a major expansion. Asking one's new spouse to take on responsibility for that debt is a fair approach. A prenup can break down how debt will be addressed in the event of a divorce, helping to ensure that any future division of wealth is both fair and in line with the business contributions of both spouses.
Source: Forbes, "Why a Prenup May Be A Woman Entrepreneur's New Best Friend", Jenny Odegard, Aug. 2, 2017