In previous decades, the stigma of asking for a prenuptial agreement prior to getting married meant that many Pennsylvania couples opted to forgo an agreement. However, prenuptial agreements are becoming more commonplace, especially as couples obtain real estate and financial assets prior to marriage. While most couples do not ever intend to get divorced, prenuptial agreements can help protect those who have businesses.
One of the ways in which a prenuptial agreement protects a person’s business is that the prenup establishes the value of the business just prior to the marriage. While any additional value may be divided during a divorce, the initial value is considered separate property and will therefore be protected. Additionally, the prenuptial agreement allows the couple to establish what will happen to any appreciation or depreciation of the business after the date of marriage.
Finally, a prenuptial agreement can provide guidelines for what percentage of the business the other person would be entitled to in the event of a divorce. For example, if it is agreed that the other person will receive 15% of the value of the interest in the company, the other person would only receive this percentage regardless of how the other marital assets, such as any real estate and vehicles, are divided up.
Going through a divorce can be stressful, especially if a person owned or has interest in a company. Dividing up the business could potentially cause the business to fail or have an adverse effect on any employees or profits the business has. A family law attorney may assist with upholding the terms of a prenuptial agreement if the other person disputes the agreement. If there is no prenuptial agreement, the attorney may be able to negotiate a divorce agreement that does not negatively affect the business or that prevent the business from being able to function.