Business Succession: What Can Premarital Agreements Cover?

While premarital agreements typically come up in the context of family law, they also have an influence in your estate or business planning as well. Working with a legal team who understands the intersection of these complex laws is important to confirm that you’ve done everything you can to explore and protect against risks.

A premarital agreement is one way to address issues related to a spouse’s business interests. Safeguarding that business is a common concern for the spouse who has put in all the work to grow the business, and therefore the company might be incorporated in a premarital agreement in one of a few ways.

The first option is a limited premarital agreement that calls out certain items of property. For example, a prenuptial agreement might name that a business cannot be distributed to any ex-spouse or a clause that discusses business appreciation and ensures that a spouse does not have the rights to appreciation value in the company.

You can also elect to use a broader premarital agreement that covers numerous items of property, including those that would be or could be acquired during the cost of the marriage.

Many times, couples are nervous about bringing up or navigating premarital agreements, but they need not induce panic. Each partner should have their own lawyer to discuss their interests in a premarital agreement so that each party understands the impact of all clauses.

If you own a business and have questions about the ways in which it could be influenced by your passing or by a divorce in the future, you owe it to yourself to meet with a knowledgeable estate planning lawyer in California to learn more about your options and to create a customized plan for your needs.


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