When people are contemplating a California divorce and one of the spouses owns a business, there are many situations where California’s community property laws can deem a business a marital asset and therefore award a share of ownership to the other spouse.  When this situation arises, it can lead to a terrible financial result for the person who has worked for years to build the business, and in some cases it can lead to a forced sale of the business or even the other spouse being named as the owner of that business.

Therefore, there are several steps that can and should be taken in order to protect the business owner’s interests in case a California divorce is filed.  While these steps will not guarantee that the business will be seen as a separate asset, they could help to alleviate the potential harm to that business when it comes time to divide the property between the spouses in accordance with California law.

For instance, business owners should keep the finances of the business as separate as possible from the finances of the marriage.  Therefore, borrowing against a home to purchase company equipment would generally not be advisable.  In addition, the business owner should pay him or herself a high salary instead of a low one, as that low salary could be seen as a sacrifice made by the whole family. Finally, the spouse should not have any official role with that business, as that could indicate a share of ownership.

San Diego High Asset Divorce Lawyers

Of course, there are many other steps that can and should be taken to protect the interests of the business owner in the family, but the specific steps will clearly depend on the circumstances that surround the situation.  Those who are in this position should be proactive and not wait until immediately before a divorce is filed to protect themselves.

If you face this sort of a situation, you need to seek the help of experienced San Diego high asset divorce lawyers who have helped many clients move through this difficult process efficiently and as successfully as possible.  Contact the law office of James D. Scott today to schedule an initial consultation.