Divorce & RE

5 Replies

Hi everyone. New to BP & RE. I've been searching for answers among past topics but haven't found one. Most topics are when divorce is happening or already had, not prior.

My question is -- are the properties in LLC protected from a divorce settlement? or one still needs to include LLC in the prenup? My thinking is since its a separate entity from the person, it should be shielded against divorce settlement. or I could be wrong.

Appreciate any input or links.

The ownership in the LLC is an asset that should be taken into consideration when dealing with divorce, marriage and prenuptial agreements. Many partnerships and closely held corporations have been ripped apart during divorces - a bit like King Solomon and the baby....

**not a lawyer, not legal advice

Medium cluebussol logo3inLinda Weygant CPA, Clue Business Services, Inc. | [email protected] | Podcast Guest on Show #244

Originally posted by @Linda Weygant :

The ownership in the LLC is an asset that should be taken into consideration when dealing with divorce, marriage and prenuptial agreements. Many partnerships and closely held corporations have been ripped apart during divorces - a bit like King Solomon and the baby....

Thanks for reply.

So does it mean if the partner is not listed on the LLC as owner, then it should be protected? or if you have an LLC and you get married, does the partner automatically becomes an owner too?

Depends on if you're in a community property state or not.  

But think of your ownership in an LLC the same way that you think of stock you might have in IBM or Google. It's an asset that has value and should be considered as such when you're working through these types of issues.

again - not a lawyer.  You should probably spend some money on one though.  Divorce and pre-nups are rarely a DIY when significant assets are involved.

Medium cluebussol logo3inLinda Weygant CPA, Clue Business Services, Inc. | [email protected] | Podcast Guest on Show #244

Depending on your state, you might be able to use an irrevocable trust to protect your assets in divorce. You would need your spouse to deed the property into the trust.

Each state has different divorce laws, just like it's been mentioned previously. It's possible for a prenup or a trust to protect property in a divorce, but they had better be done correctly. 

Good luck trying to protect property that is acquired with marital funds.