If you and your spouse started a business together during your marriage, the end of that marriage could leave you wondering what will happen to the company you built together. Splitting a business during the divorce process requires careful thought and planning. What should you know?
First, consider how much your business is worth.
First, you need to find out how much the business is worth. Depending on your business, this value could include what the company owns, how much it owes, how much money it makes and what the market looks like. Knowing the value is key because it can help you fairly divide your property and make informed decisions about how to split the business.
Consider your options for ownership after divorce.
After knowing the value, you need to decide who will own the business after the divorce. Your options include:
- One spouse buying the other out: One spouse can buy the other’s part of the business. This might involve a one-time payment or a series of payments.
- Selling the business: If neither wants to keep running the business, or if they cannot agree, they can sell it and equitably split the proceeds.
- Co-owning the business: Sometimes, ex-spouses decide to keep owning the business together. This often requires ex-spouses to outline their responsibilities to the business, how they will handle disagreements and how they might handle a sale in the future.
You should carefully consider your financial situation before deciding how to handle your business to ensure that you choose the right path forward.
Review your current documents or create new plans.
Legal agreements play a vital role in the process of dividing a business in a divorce. It is essential to update any existing agreements and create new ones that reflect the change in marital status and business ownership. These might include buy-sell agreements, operating agreements and any other relevant business documents.
Work with an attorney who can help you with this complex process.
Hiring a knowledgeable Mount Laurel divorce lawyer is not just about legal representation. Your attorney will also provide you with support and insight into how divorce could impact you and your business. This is very important when emotions run high. Your lawyer will help you determine the value of the business, negotiate for you and make sure you manage all the legal details of dividing the business properly.
Your choices can impact your life, your finances and your business for years to come. With the right guidance, you can approach this process with more confidence and clarity.