You built your business before you got married, and now, facing a divorce, you are wondering whether your spouse has a claim to it. The honest answer is that it depends on whether the business has grown due to active marital efforts or funds since your wedding day, not just on whose name is on the paperwork.
What counts as separate property in Maryland?
Property you owned before the marriage or received by gift or inheritance from someone other than your spouse, typically stays separate. Under Maryland’s marital property law, marital property means anything acquired during the marriage, regardless of whose name is on it. A business you started before getting married usually falls outside that definition, at least as of your wedding date.
How can a business become marital property over time?
If the business grew in value because of either spouse’s active effort, rather than market trends alone, that growth, known as active appreciation, can be treated as marital property, even if the business started as yours alone. The same is true if marital funds were put into the business along the way. In practice, this often means a business ends up part separate and part marital.
Why does a professional appraisal matter in your case?
A professional appraisal establishes what your business was worth on your wedding day compared to what it is worth now. That difference determines how much of the growth counts as active appreciation, and therefore as marital property. Without a clear valuation, it can be difficult to show how much of your business remains yours alone.
How does Maryland divide a business in a divorce?
Maryland courts generally cannot transfer ownership of a business from one spouse to the other. If part of your business is found to be marital property, the court can instead grant your spouse a monetary award based on its value, while you keep the business intact. A divorce may affect what you owe, but it does not typically mean losing control of what you built.
You have options for protecting your business
Going through a divorce while running a business you have worked hard to build can feel like a lot to manage on your own. If you are a business owner facing this situation, it may help to talk through your specific circumstances with a family law attorney who can guide you through a valuation and what it could mean for your case.