If I’m planning to divorce my husband but want to start a business, what structures can I use to protect the business from being counted as my asset?
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If I’m planning to divorce my husband but want to start a business, what structures can I use to protect the business from being counted as my asset?
Asked on December 1, 2015 under Family Law, North Carolina
Answers:
SJZ, Member, New York Bar / FreeAdvice Contributing Attorney
Answered 8 years ago | Contributor
You can't stop a business you own from being counted as an asset of yours during a divorce if you launch or begin it while still married: all income and assets acquired during marriage (with a few exceptions which would not apply here) are considered in distributing property and setting support (if any), even if you put the assets or business in an LLC, a corporation, a trust, etc.--courts will look past the formal structure to the reality of who owns, controls, and benefits from the business & its assets (you).
That said, you can minimize the assets owned by the business--things owned by others and leased are not marital assets. If you need office equipment, only buy what has to be bought and lease what you can (like a copier); if you need a vehicle for the business, lease it; if you're selling things, keep a lean inventory; don't keep excess cash in the business, but put it back into things, like PR or advertising or marketing, which will help the business grow for the future but also keep cash from sitting around for distribution; etc.
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