What Happens to Your Business in a Divorce?
For couples with a high net worth or multiple assets, determining equitable distribution can prove difficult. This is especially true of business owners who own multiple businesses and have invested a significant amount of money in them. Florida statues state that marital assets should be divided 50/50, which includes all assets acquired during the marriage. This includes businesses; however, what does this mean for the business owner? Today, we go over what happens to your business in a divorce.
Marital Assets Versus Separate Assets: Determining What to Divide
The first step to determining what will happen to your business in a divorce is to ask yourself if your business will be considered separate or marital property. Separate property is property acquired before marriage, including gifts and inherited assets, and marital property is property acquired during marriage.
As all marital property in Florida is subject to equitable distribution, this includes any businesses you acquired after marriage. If you have any questions or concerns about whether your business would be considered separate or marital property, consult with an experienced lawyer for additional support. If you do not own a business, but your spouse does, you will also want to make this inquiry. Your spouse’s six-figure business could be marital property, which is an asset you would want to include in your settlement.
Steps to Take Before Dividing a Business in a Divorce
You will want to conduct a business valuation to determine how much the business is worth. It is also a good idea to get an estimate of the business’s future worth as well. Next, you want to determine if the business is viable without both of you. For instance, if only one spouse works for the business, the other one may not want to be a part of the business in the future. Therefore, it would not make sense for this couple to continue to share the business.
In instances where a couple has both worked hard to make the business successful, dividing the business may be a little more complicated. There are some options though, which are as follows:
- Determine if you can sell the business to a third party (this is especially true if you know the business is valuable and you and your spouse do not want to own the business after getting divorced)
- Consider if it is possible for you both to continue to work together in the business
- Buy out your spouse’s share of the business
Consult with an Experienced Divorce Attorney from Our Firm
Divorce is not an easy process, especially if you have acquired significant assets over the years. When a couple owns a business - or multiple businesses - together, the process can get even more complex. As such, it is important to ensure you secure the services of an experienced divorce attorney who has handled similar cases in the past. At Dale L. Bernstein, Chartered Law Office, we provide comprehensive divorce services for high-net-worth clients, including clients with businesses.
Consult with our firm online todayor call us via (727) 312-1112 to schedule an appointment.