KWERY:
My husband is proposing that as part of our divorce agreement I receive alimony stated as a percentage of the net income of his business. I’m not sure if that’s a good idea.
RESPONSE:
Generally speaking, it’s not a good idea, unless you have a very high level of comfort as to the integrity and reliability of the reported net income. In a sense, net income of the business can be anything that your husband (or his accountant) wants it to be (obviously within reason and limits). My point here is that unless you clearly define how you get to net income (and even then this is questionable), any such arrangement is fraught with a multitude of problems.
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