Will I Have to Divide My Business in a North Carolina Divorce?
The city of Charlotte is built upon a foundation of hard-working business owners. These business owners can run into all kinds of problems over the course of their careers, and a divorce certainly represents a major hurdle. If you are going through a divorce in Mecklenburg County, you might be wondering how your divorce will impact your business. It is an understandable concern. After all, you might have spent years diligently building your business from the ground up, pouring money, time, and stress into your dream. The prospect of having that dream taken away after a failed relationship is a scary thought.
Thankfully, there are plenty of resources available for business owners who are going through a divorce. Enlist the help of a qualified, experienced divorce attorney in Mecklenburg County, and you can avoid many issues for yourself and your business. A skilled attorney can not only educate you about the various considerations associated with business ownership during a divorce, but they can also guide you forward. With the right attorney at your side, you can keep hold of your business and make sure that your spouse is not overstepping their bounds.Is Your Business “Separate Property”?
If you are concerned about losing part of your business in a North Carolina divorce, the first question you need to ask yourself is simple: Did you own your business before the marriage? If the answer is yes, then you generally you may not have to worry about dividing your business. This is because everything you owned prior to your marriage is considered “separate property.” As the name implies, separate property is kept separate from divorce proceedings, including the process of equitable distribution. Equitable distribution involves dividing assets among spouses.What if I Started My Business During the Marriage?
Things become much more complicated if you started your business during your marriage. According to North Carolina law, property and assets acquired during the marriage are considered “marital property.” Unlike separate property, marital property is indeed subject to equitable distribution, which means that your business could be divided.How Is a Business Divided?
The next step is to determine how the business is handled according to the equitable distribution process. It is important to understand what “equitable” means in the context of a North Carolina divorce. Despite what many people might think, “equitable” does not necessarily mean “fair.” A fair division is a 50/50 split. An equitable distribution takes many factors into account and divides assets based on these factors. The court may determine that an “equitable” split involves one spouse receiving a 75% share of the business, while the other receives 25%.
If you played a major role in the business, you may be more likely to receive a greater share. For example, you might have started the business without any help from your spouse, and you might have been solely responsible for its operation over the years. If your attorney can show the court the significance of these factors, you might have a strong chance of keeping most of your business.
However, your spouse can easily request and receive part of your business, even if they had nothing to do with its operation. The court will assume that your spouse was supporting you on an emotional level and assisting you with other important tasks while you were running your business. These tasks might include raising children, buying groceries, and running the family home. In the eyes of the court, these contributions should not be overlooked, and they become factors when considering equitable distribution.An Agreement Is the Best Option
If you want to keep hold of your business in North Carolina, an agreement with your spouse outside of court is probably the best option. If keeping your business is your top priority, you can sacrifice other assets in exchange for keeping 100% control of your business. For example, you might agree to let your spouse have 100% of the family home, while you keep 100% of the business. This could be a smart decision if your business is highly profitable, since you can earn the value of your home many times over in the future with your business. An attorney can help with these negotiations.Enlist the Help of a Qualified Attorney Today
If you are concerned about your business as you go through a divorce, you should take action as soon as possible. Reach out to Arnold & Smith, PLLC at your earliest convenience, and we can begin the process of protecting your business. We understand the concerns of business owners in Charlotte, and we have considerable experience with high net worth divorces. Reach out today, and we can help you achieve justice and continue being an important part of North Carolina’s economy.