Most California couples enter their marriages believing their unions will last their lifetimes. This is obviously not the case for many spouses in this state and throughout the nation nowadays. Some people face particular challenges when they divorce, especially business owners. There are several means for protecting business assets in divorce, one of which involves trusts.
A trust is a separate entity that may own property and/or bank accounts related to a particular business. Many business owners choose to secure their assets by placing them under the protection of a trust. Although a trust need not be registered as a business, a trust must have a federally assigned identification number to differentiate it from a business owner.
Some business owners take steps to protect their assets before their weddings take place. This is typically a simple process that includes prenuptial agreements. This is, in fact, one of the easiest ways to establish separate ownership of a business so it won’t be subject to asset division should divorce later occur.
Nearly 80 percent of all businesses in the California and elsewhere in the United States are solely owned with no employees. It’s understandable that these and all other business owners would want to protect what they worked so hard to build should their marriages wind up going through divorce. Many business owners enlist the help of experienced estate planning attorneys to learn more about trusts and other options that might be available to protect their business assets from division in court.
Source: under30ceo.com, “How to Protect Your Business From Divorce“, Rowena Kang, Accessed on April 4, 2017