In This Chapter
Planning in advance with prenuptial and postnuptial agreements
Understanding what a divorce can do to a family business
Establishing the business value in a divorce
Finding out the importance of valuation dates
Divorce can be one of the biggest threats to the future of any closely held business, as well as to the people who depend on it.
When married business owners begin a divorce action, whether one party or both parties were involved in the day-to-day business, they set a series of financially threatening events into motion. Children, stepchildren, in-laws, business partners, and employees are affected by these events on both a short-term basis (the split of assets in divorce) and a long-term basis (the distribution of assets among multiple families at the time of a former spouse’s death).
In this chapter, we talk about prenuptial and postnuptial agreements, and we also discuss the role of business valuation during divorce proceedings.
Doing Estate Planning Regardless of Marital Status
In estate matters (see Chapter 20), it’s a good rule of thumb to review your plans every three years or whenever a material change in your family’s lifestyle occurs, such as a marriage, a divorce, a remarriage, the birth of children, the loss of an immediate family member, or a major rise or fall in assets.