Whether you founded your business during your marriage or your business became commingled during your marriage, the court may determine that the company you have built will be divided along with your other property. If the law considers your business joint property, what options are available to you?
Buying out your spouse could allow you to continue business on your own.
You have built your business through dedication and hard work, and you may want to continue your company after the end of your marriage. In this case, you may want to buy out your spouse’s share of the business so that you can enter this new phase of your life as the company’s sole owner.
If you choose to buy out your spouse—or if you sell the business outright—it can be especially important to determine the value of your business so that you get your fair share in property division. Depending on your business and current market conditions, you may determine that value based on your business’s assets, the market value of similar businesses or your business’s income.
Exchanging other assets may offer flexibility.
Depending on the value of your business and your goals during property division, you may not have the funds to buy your spouse’s share outright. In these cases, you might exchange other valuable property like your family home.
Selling the business could offer you funds for new ventures.
Whether because they want to move on to new opportunities or because they cannot come to an agreement about the business, some divorcing couples sell their business and divide the proceeds. As Forbes notes, though, the sale process may lengthen your divorce proceedings.
Continuing to run your business together may ease the transition.
Especially if you and your spouse founded this company together, you may agree to put your business first and continue as co-owners. As the American Bar Association notes, this is not an option for every couple, and it usually requires careful planning on the part of both owners. However, it allows you to continue building your business, and it may give you time to raise the funds to buy out your spouse in the future.
By carefully considering the options available to you, you can create a strategy for property division that protects your business and your interests.