Divorce is a complicated and sometimes traumatic experience. As a small business owner, your divorce may also affect your consulting company. It can have an impact not only on your profits, but on your employees and clients as well.
During the divorce process, a professional will value all of your assets so that the Colorado court can divide them according to the equitable property principle. A financial expert will examine your business's books and records and ask questions about your operations. It is possible that your wife will also hire a professional to provide a second opinion of the value of your business.
You may have to pay out a certain amount to your wife based on current and future potential earnings. If you or the business does not have enough cash to pay your future ex her equitable share of the company, you may be forced to sell it in order to pay her court ordered share.
Fortunately, there are ways to lessen the impact of divorce on your company.
Get legal counsel
The first thing you should do now that you are planning to divorce is to hire a Colorado attorney experienced with high asset divorces. Good legal counsel can provide guidance on protecting your business and how you should manage the other aspects of your divorce.
Hire only one financial expert
Talk to your wife about hiring one financial expert that you both trust to value the business. This will help keep costs down and free up capital that the court could divide in the settlement rather than the two of you spending it on the divorce. Furthermore, by using only one financial expert, the valuation will more than likely take less time.
Consider a confidentiality agreement
As with any business, your records probably contain sensitive information concerning your operations and your clients. You have the right to request that all parties, including legal counsel, financial experts, and even your wife, enter into a confidentiality agreement so that they cannot divulge such information or trade secrets.
An installment agreement may be a good option
If your company is not liquid enough to provide a lump sum payment to your future ex-wife, consider an installment agreement. You may be able to structure the divorce settlement so that you can pay your spouse her share of the company over a set amount of time.
The involvement of a business can make any divorce more complicated. Part of the reason for this is that the business is often the largest marital asset that the couple owns. Take the time to understand your rights and options with regard to the division of your business and other marital property.