Protecting a Business & Its Assets in an Arizona Divorce

Protecting Your Business and Its Assets During an Arizona Divorce

Getting a divorce is tough, especially when you own a business. You’ve poured your heart, time, and money into building a company, and now you’re unsure what will happen to it and your assets. Fortunately, there’s legal protection for businesses during divorce. The Law Office of Hector A. Montoya can help if you’re in Pima County, AZ. Keep reading to learn how businesses are handled in Arizona divorces and what steps you can take to protect your assets.

How Divorce Can Impact Business Ownership

In Arizona, assets acquired during a marriage are usually considered community property. This means they’re owned equally by both spouses. If your business opened or grew significantly during your marriage, it could be seen as a community asset. This can make your divorce more complicated, as the business’s value will need to be divided.

Determining how to handle the business assets in a divorce can be a major point of conflict. You and your spouse will need to agree on the value of the business and how to split it, which can be challenging without legal help.

How Are Business Assets Divided During Divorce?

Since a business is often deemed community property, its value must be divided fairly between both spouses. Dividing a business is not as simple as splitting a bank account. There are several ways to handle the division of business assets in a divorce:

• One Spouse Buys Out the Other – The business-operating spouse can pay the other spouse their share of the business’s value.
• The Couple Continues to Co-Own the Business – This is less common and only works if both parties can work together peacefully.
• The Business is Sold – The proceeds from the sale are then divided between the spouses.

How the Value of a Business Is Determined

To divide a business fairly, you must know what it’s worth. Valuing a business for divorce is a detailed process that often involves hiring a professional business appraiser to determine its fair market value. To get an accurate valuation, they’ll consider:

• Revenue and profits
• Business assets, such as equipment and property
• Debts and liabilities
• The business’s reputation and potential for future growth

Legal Strategies to Protect Your Business During Divorce

There are several legal strategies you can use for legal protection of your business assets in a divorce:

• Postnuptial Agreements – These legal documents are created during a marriage to define how a business will be treated in the event of a divorce.
• Buy-Sell Agreements – If you have business partners, a buy-sell agreement can outline what happens if a partner gets divorced. This can prevent a spouse from becoming an unwanted business partner.
• Negotiating a Buyout – One of the most common solutions is for one spouse to buy out the other’s interest in the business. This can be done with a lump-sum payment or through a structured payment plan.

Contact Us for Legal Support in Tucson

Knowing how to protect your business from divorce is essential. You can rely on the Law Office of Hector A. Montoya to help. We have the experience and expertise to help you maintain your assets. Contact us in Tucson today for support and guidance.