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Is your future ex entitled to a portion of your business?

On Behalf of | Feb 7, 2020 | Firm News |

When you thought of your perfect life, you may have imagined yourself with a spouse, kids, a nice house and your own business. Over the years, you may have made many aspects of that perfect vision turn into a reality, but you may also have found yourself facing not-so-perfect ordeals. In fact, your once-happy marriage is now coming to an end, and you may have concerns that other aspects of your life will face negative effects.

In particular, you may wonder what will happen to your business during your divorce. This is an understandable concern, as the financial effects of ending a marriage can have far-reaching implications, and you undoubtedly do not want the business you worked so hard for to suffer.

Is your spouse entitled to the business?

First, you may want to determine whether your spouse could have any entitlement to the business or business assets. If you started your business after you got married, the court will likely consider it a marital asset. Under Alabama property division laws, the court divides marital assets as fairly as possible, which means your spouse could have a claim to a portion of the business.

On the other hand, if you started the business before you married, your spouse may not have a claim to the company itself. However, assets earned from the business after you married count as marital property. You may think that your spouse should not receive anything from the business because he or she played no part in running it, but that is not how this situation works.

Your business and spousal support

Aside from being an asset, your business also generates your income. As a result, some complications could result when determining spousal support. If your spouse does receive assets that account for the value of the business, it may not be fair to also count the income of the business when considering whether your spouse should receive alimony after the divorce. Of course, you may not know how to properly protect your interests in that particular area.

Luckily, you do not have to navigate these tricky areas on your own. An attorney experienced in addressing valuable and complex assets in divorce could help you better understand how to protect your business, and how its value and your income from it could influence other areas of your case.