Attorney
Technically, yes. You can also start eating gas station sushi and get a Mike Tyson-inspired face tattoo. There’s no New Mexico law that will stop you from doing any of these things.
But if you’re a business owner or professional contemplating these moves, the honest answer is: it’s legally possible, practically risky, and rarely gets you what you actually want.
As someone who decided to leave his family’s fourth-generation retail shoe business, open his own retail shoe business, sell it, and go to law school after experiencing the divorce process first-hand, Attorney Bob Matteucci understands better than most that “can I” and “should I” are two very different questions.
Why the Timing Matters
New Mexico is a community property state, which generally means the value assets that are acquired or that increase in value during the marriage—including businesses—are typically subject to equal division at divorce. The meter starts running as soon as you walk down the aisle, not the day you file for divorce.
Selling off an asset shortly before filing for divorce doesn’t mean it disappears from the marital estate. It just changes what’s being divided. Instead of dividing up the value of a business operating as a going concern, you’re splitting the proceeds of a sale.
While dividing a pile of cash by two may sound a whole lot easier than sawing a business in half like some sort of magician, it’s often not. If the timing, price, or structure of the deal looks like it was designed to reduce what your spouse would otherwise be entitled to, you’ve traded one issue (dividing the business) for a much bigger one: a fight over whether you engaged in dissipation of marital assets, or breached the fiduciary duty spouses owe each other over shared property.
Courts take a hard look at transactions that happen on the eve of divorce, and a rushed or below-market sale can end up costing you a big chunk of change.
What You’re Actually Trying to Protect
While there are always a few exceptions to the rule, most business owners in the Albuquerque area are honest people. If they try to sell off their business before getting divorced it’s not because they are trying to screw over their spouse.
When business owners think a quick sale would be best, it’s often because they want certainty and control over something when their personal life is spinning out of control. They want to know the business they built will keep operating, that they won’t be forced into a fire sale, and that whatever split happens will be simple and fair so that both parties can move forward.
For example, consider a solo dental practice owner, who knows divorce coming so he sells his practice to a colleague at a steep discount three weeks before filing, structuring the deal himself in order to move quickly. Even if his reasoning was “I just wanted this settled,” that transaction is now evidence. His spouse’s attorney will ask why the practice was sold below its appraised value, why the timing lined up the way it did, and whether he consulted anyone before signing. What could have been a straightforward valuation and buyout becomes a forensic accounting nightmare. The exact opposite of the peaceful, efficient outcome he wanted.
Compare that to the actions of a local real estate investor. She knows the divorce is going to be hard on the business, so she talks to an attorney like Bob who understands both the legal and business sides of divorce. Someone who can help run an honest valuation, model out buyout options, and negotiate a structured settlement that keeps the business intact and operating.
Same starting points. Very different outcomes.
Serving Families with Dignity & Compassion
Wanting closure is normal. So is wanting to control what happens to your business. But there are better ways to get you where you want to go than selling your business before you file for divorce.
If you’re weighing a business decision ahead of a divorce, the right time to talk to an attorney is before you act, not after. Contact Bob Matteucci to talk through your specific situation before you make a move you can’t take back.