Many Kentucky entrepreneurs own their own business, and these business can be wildly successful. Some business owners eventually marry, but continue to be the sole owner of the business. Unfortunately, not all marriages are meant to last. Sometimes, if your spouse owns a business and divorce is on the horizon, it is important to make sure your spouse is not unscrupulously using the business to have the upper hand, financially.
One example is if the business-owning spouse suddenly declares that the business is not producing any income, despite what he or she may have told his or her spouse previously or despite the lifestyle the couple enjoyed. A "sudden" business failure could be a maneuver to keep the business-owning spouse from having to pay a settlement that is fair and appropriate.
For example, the business-owning spouse could be paying his or her personal expenses via the business' funds instead of through a regular paycheck. This may make it easier for that spouse to claim he or she does not have any income. Moreover, by taking on the business-owning spouse's expenses, the business itself also appears to have lost value and is not producing an income.
The timing of this sudden loss of income is important. It could be the case that the business-owning spouse was anticipating a divorce long before the divorce papers were served. If the business' value suddenly dropped during an unrelated rough patch in your marriage or the minute the spouses separated, this could indicate that the business owning-spouse is trying to dishonestly gain the upper hand in the divorce.
Moreover, in such situations, the business-owning spouse may drag his or her feet in providing evidence about the business' financial state, such as credit card statements, information about bank accounts and copies of business checks. Dragging out the time it takes to uncover such evidence could prompt the other spouse to settle for an amount less than what he or she deserves, just to have the divorce proceedings finally end.
Fortunately, attorneys familiar with couples going through a high asset divorce may be able to detect when a business-owning spouse is misrepresenting the value of the business and through that, his or her own income. With the right help, it is possible for the non-business-owning spouse to reach a fair divorce settlement.