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If you own a business in Pennsylvania, you could lose some or all of your ownership interest in that company if your marriage comes to an end. However, there is also a chance that your organization will be seen as separate property or otherwise excluded from being divided in a divorce.

When a business is marital property

Your business may be defined as marital property if your spouse also has an ownership interest in the business. Furthermore, it may also be considered a joint asset if it was founded after the marriage became official. Businesses that were founded before a marriage began could still be joint property if your spouse contributed to the organization in a meaningful way. In the event that your company is a marital asset, it will likely be allocated in an equitable manner as opposed to a straight 50/50 split.

How to keep your company out of a divorce settlement

A prenuptial agreement may make it possible to define your company as a separate asset regardless of who runs it. If the company begins operating after your union begins, a postnuptial agreement may be needed to ensure that the organization remains a separate asset. The same may be true if you brought the asset into your marriage but chose not to create a prenuptial agreement for any reason.

Don’t forget about a spouse’s contributions outside of the company

If your spouse stayed home to raise the kids or keep a marital home in good condition, he or she may be compensated for doing so. In some cases, this may mean receiving an ownership interest in your business or a portion of any future profits it may generate.

A family law attorney may be able to talk more about how a company might be divided in a divorce. He or she may also recommend ways that you might be able to keep most or all of your business in a final divorce settlement. In some cases, this may be done by offering to part with other assets.