Can I Protect My Business Ownership With a Prenup or Postnup in Texas?

 Posted on June 17, 2022 in Prenuptial Agreements

Businesses frequently take many years to become successful. During those years, the business owner spends countless hours of difficult personal labor ensuring the business has what it needs to succeed. He or she usually spends significant amounts of personal money to help the business grow. Yet when a business owner gets divorced in Texas, he or she risks losing everything in the marital asset division. Not only is this discouraging and demoralizing, it can cause an older business owner to risk retirement prospects by derailing their financial future. Thankfully, this outcome is not inevitable. With the help of a prenuptial or postnuptial agreement, you can protect your business ownership against an unexpected Texas divorce. 

How Can a Prenuptial Agreement Protect My Texas Business? 

Prenuptial agreements exist specifically to detail the treatment of property in a divorce when spouses are clear-minded and willing to protect their interests and even their spouse’s interests. Although prenuptial agreements may not seem romantic, the period before the marriage begins is when each spouse has the opportunity to delineate what he or she wishes to remain personal property in the event of divorce.

Would My Business Be Considered Community Property? 

Although your ownership in the business before your marriage would remain your personal property, any business growth or earnings are marital property after the marriage has begun unless otherwise specified in a prenup. Anything that is not protected by a prenup or postnup must be divided equally in a divorce. It can be very difficult to determine how much of a business’s value was one spouse’s personal property before a marriage, especially if that spouse did not document a business valuation just before the marriage began. 

What if We Are Already Married and I Want to Protect My Business? 

A postnuptial agreement functions similarly to a prenuptial agreement and can be entered into after a marriage has already begun. Unless there is some question as to a postnuptial agreement’s legitimacy, a postnuptial agreement is a legally binding document just like a prenup. However, if the marriage has already begun, the real challenge with a postnuptial agreement tends to be convincing the other partner to sign it. An attorney with experience drafting prenuptial and postnuptial agreements can meet with you and your partner to explain the benefits of such agreements. 

Meet with a Dallas Prenuptial Agreement Lawyer

If you have worked hard to create a successful business, avoid risking it in a divorce by writing a detailed prenuptial agreement that protects your business ownership. Call the Dallas, TX prenuptial agreement attorneys at Clark Law Group for help at 469-906-2266 today.

Source: 

https://statutes.capitol.texas.gov/Docs/FA/htm/FA.4.htm