Adding your spouse as a shareholder can have benefits for both you and your business. When it comes to running a business, there are many decisions that must be made. One of the most important choices is who will own a portion of the company.

First things first: professional guidance is a must when making big changes to your business. You don’t want a poor execution to end up dragging you and your spouse down. Book a free consultation with us and we’ll help determine what steps are best to take.

With that being said, adding shareholders can be a good thing and a great option is your life partner. Here are the top three reasons it makes sense.

You Can Share Dividends With Your Spouse

You can provide him or her with dividends from the company’s earnings. Not only does this allow you to share the success of your business with your spouse, but it can also provide them with additional income.

The Tax Benefits Of Adding Your Spouse As A Shareholder

By adding a shareholder who is in a lower tax bracket than yourself, you can fully take advantage of the tax savings that come from having multiple shareholders.

Your Spouse Has Continuity Of Your Business

In the event of the business owner’s death or incapacity, a spouse can provide continuity for the business. Having them involved in the business allows for a smooth transition, should anything happen to either of you.

A Quick Note About Voting Shares

If you intend to maintain control of your company, it’s important to remember to deny family members the ability to vote with shares issued to them. Second, the board of directors should have the authority to declare dividends. That way, especially if you’re the only director, you effectively have the authority to determine when dividends will be paid.

Who To Talk To As You Take This Beneficial Step

Adding your spouse as a shareholder can be helpful for both of you and the company. By understanding why, you have taken the first step towards making the right decision for your business.

If you are considering taking this step, it’s important to consult with an attorney who specializes in business law; they can make sure all paperwork is properly filed. Doing so can help ensure that all parties involved are adequately protected in the process.

Contact ACM CPA for a free consultation today if you’re thinking of adding your spouse as a shareholder in your business, so we can make sure it’s done properly and that you maximize the tax benefits.

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