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If you and your spouse are business owners who are facing divorce, you are likely dreading the property division phase of the process. If you started your business during your marriage, if your spouse has an active role in the business or for a number of other reasons, the business may be considered a joint asset.
Your business may well become the focal point during the property division process. Here are three options to consider when determining the fate of this important asset.
Sell outright
You and your soon-to-be-ex may decide that the most reasonable course of action is to put the business on the market. This might be an especially good idea if the business is well-established and profitable. You can sell it, split the profits and move on with your lives—even start other businesses if you wish. However, the first step is to engage the services of an appraiser to place a value on the business so that you can arrive at an appropriate selling price.
Sell to your spouse
Usually, one spouse is more invested in the family business than the other, either financially or in time spent in the daily operations. Therefore, you might want to sell your interest in the business to your spouse or vice versa. Once again, you will need an appraiser to perform a valuation. Note that if the buyer does not have the necessary funds for the transaction, agreeing to an exchange of property with similar value is a consideration.
Continue on
If you and your spouse believe you can go on working together despite the divorce, you may wish to continue as business partners. This is not a viable option for every couple, but there are benefits. The expense of a valuation will not be necessary, and you will be able to retain your respective shares of the company. In an amicable divorce, keeping the business in the family may be the best option of all.
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