When two people get married in Arkansas, they are perceived and operate as one entity. That’s why you file your taxes together, are both liable for each other’s debts and can confidently say that your partner’s property is yours as much as it is theirs. Therefore, upon divorce, almost everything will be affected, including your business.
Divorce is a really stressful process; you have everything to deal with, including your children, all your assets and debts, family, court deadlines and requirements, while your emotions are running high. You can easily be pulled away from your managerial responsibilities.
This can significantly impact your business, especially if you’re a small business owner or sole proprietor. Your customers and clients can sense when something is wrong, and they might start to look for other options.
Your business assets
If you own a business with your spouse, it’s likely that the court will order the business to be sold and the proceeds split between the two of you. Not only will you lose a fair share of the equity in the business but also part of its value. You might be able to keep the company if you buy out your spouse’s share, but this can be difficult to do, especially if you’re already cash-strapped from the divorce.
Your personal finances
If you have joint accounts with your spouse, these will need to be closed and new ones opened in each of your names. This disruption in payments can damage your credit score. You might also have to sell some of your assets, like your home, investments or separate property, to cover the cost of the divorce.
Besides, separation can take a toll on your mental and emotional well-being, which can, in turn, impact your business decisions. It’s important to take care of yourself during this time to make sound decisions for your company.
Divorce is tough, but you can get through it. Yes, your business could be affected, but that doesn’t mean that your career or passion will end. Most couples in Arkansas consider options that give them more control over their divorce outcome, like arbitration or mediation, especially if something as sensitive as a business is involved. In addition, if you had a nuptial agreement that touched on matters to do with your company or property division, the court is more likely to honor it.