Dividing Business Assets During a Divorce
Marital property division is an important issue in any Florida divorce case. Decisions you make during this process have the potential to impact your financial security for years to come. This is particularly true when there are business assets involved. Whether it is a family business you have owned since before your marriage or a partnership established with your spouse, it is important to understand your options before making any agreements.
Florida Marital Property Division
Guidelines for dividing marital property during a divorce are listed under Section 61.075 of the Florida Statutes. Any real estate, personal property, financial accounts, or other assets you have accumulated during your marriage will be divided on an equitable, though not necessarily even, basis between you and your former partner. Factors that influence property division include:
- The length of the marriage, along with the age and health of each spouse;
- Each person’s income and earning potential;
- Contributions each made to accumulating assets;
- Actions each made in either increasing or decreasing property value;
- Career or educational sacrifices either spouse may have made in support of the other.
While property division deals only with marital property, a spouse may claim an interest in a family business the other owed prior to marriage if they made significant contributions to increasing its profits or worth.
Understanding Your Options
If a business was one that you started along with your spouse, Market Watch advises that there are three main options for dealing with it during your divorce:
- Remaining business partners: This will depend both on the type of business involved, as well as the relationship you have with your soon to be former spouse. If your divorce is an amicable one, the both of you may be able to continue on as partners, provided you negotiate a contract that clearly defines expectations, along with each one’s duties, liabilities, and the division of profits.
- Buying out your spouse: Your business may represent the bulk of your net worth, so a buy out could be financially challenging. You will want to carefully consider how the business is valuated, along with options for payments. Market Watch advises that a bank loan is often the best and easiest option, costing the lowest overall amount of capital.
- Selling the business: If continuing on with your spouse is not an option but you do not have the money to buy them out, you may need to consider selling the business and splitting whatever profits you make from the sale. Unless you can sell for far more than you originally invested, this is likely to be the least attractive option for most business owners, but it does allow you to start over with a clean slate.
Before making any agreements or signing any legal documents related to dividing or selling your business, contact attorney Vanessa L. Prieto first. We can help ensure your interests are protected when it comes to marital property division, and that you get the maximum amount you are owed. Call or contact our Fort Lauderdale office online today to request a consultation.