Texas business owners who are planning on getting married may want to consider prenuptial agreements. Owning a business without having such an agreement in place can be disastrous for a company if the marriage subsequently comes to an end. The other spouse could be eligible to receive half of the company’s appreciation that took place during the marriage.
Prenuptial agreements can also limit access to any other assets a person is bringing into the marriage as well as debt liability. A prenup can specify that each person is responsible for their own debts. It can also outline a plan for dealing with debt that is acquired during the marriage. Keeping careful business records demonstrates that the business and personal accounts remained separate throughout the marriage.
Some factors may lead to a court finding that a prenuptial agreement is invalid and unenforceable. The agreement should be negotiated well in advance of the wedding day, so as to preclude a subsequent argument that one of the parties was forced to sign it under duress. Each party should be represented by separate legal counsel. In addition, there are certain items that cannot be covered as being against public policy, such as child custody.
The existence of a prenuptial agreement does not always mean that property division in divorce proceeds smoothly, and even with one in place, a person who is divorcing may want to discuss the situation with an attorney. For example, a person might have gone on to contribute significantly to the spouse’s business after signing the prenup.