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Tips for divorcing entrepreneurs

Texas divorce courts follow community property laws for the division of assets, which means that all debts, property and other assets acquired during a marriage are marital property and equally divided between the spouses upon a divorce. However, special documents and orders, such as prenuptial agreements, could mean that the assets are divided differently. This is why it is important for entrepreneurs to protect their businesses in case of divorce.

In a divorce, the business that an entrepreneur owns is an asset, and the judge takes the value of the business into account when making a property division order. Even if a business was started prior to a marriage, the amount of its appreciation in value that occurred during the time that the couple was marriage could be deemed community property and thus subject to division.

Rather than hide business assets, a divorcing entrepreneur should make known every asset involving the business, including personal assets. Judges and the law do not take kindly to spouses who hide money and property on purpose. Doing so could mean that the divorce takes longer and costs more when the person's actions are discovered. Even when spouses agree to their own settlement for the division of assets, it is important that this settlement gains court approval and is legally bound and enforceable with a court order. Having a court order prevents one party from making future claims that could cause financial distress for the company.

Property division is often a contentious part of a divorce, even when the split is amicable in other respects. A business owner who is facing the end of a marriage may want to obtain the assistance of a family law attorney in seeking to negotiate a settlement agreement that will protect the future operations of the company.

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