Divorce and Your Family Business
Divorce is messy enough on its own without the added stress of figuring out what to do with the business that you and your soon-to-be-ex-spouse have run for the last several years. At the time you started your business, you and your spouse/partner probably didn’t even think about what would happen to the business if you separated or divorced. Now, however, the dilemma becomes how to handle what may be a significant asset in your divorce proceedings. Fortunately, there are at least three ways that you can choose to deal with your family business as you and your spouse face a divorce.
Continuing to Own the Business Together
While this may not be an ideal situation or even possible, some ex-spouses do continue to work together in order to run a profitable business. The benefits to this approach are that neither spouse has to sell his or her interest in the business, and there is no need to formally appraise and place a value on the business, which can be expensive. However, you have to be able to work in close proximity to your ex-spouse while still maintaining an amicable business relationship.
Buy Out Your Ex-‘s Share of the Business
If you want to continue to own and/or run the business, but maintaining it jointly with your ex is not an option, then Florida law will treat the business like any other asset and, along with the other assets that you own, divide in a fair and equitable manner between the two of you. This can be a somewhat costly process, particularly if there is a big dispute over how much the business is worth. In the best case scenario, you and your spouse can agree to hire one appraiser to place a value on the business, as opposed to double the cost needed for each of you to hire your own appraiser. Once you have a value placed on the business, you can buy out your spouse’s share of the business, either with cash or by using other marital assets for an even exchange. To a large degree, whether you can successfully buy out your spouse’s share depends on your ability to raise the funds to do so, or having sufficient marital assets to offer your ex in exchange for the business share.
Sell the Business
The other option in terms of dividing your family business during a divorce is to sell the business and split any profit from the sale with your spouse. You still should have an expert place a market value on the business and then place it on the market. If it does sell right away, you may have to continue to operate the business with your spouse longer than you would prefer, but a sale hopefully will pay off any outstanding debt owed by the business and give you each some funds to use as you choose.
Allow Your Florida Divorce Attorney to Assist You
Choosing how to handle your family business in your divorce is a complex decision that involves the consideration of many different factors. If you are in this situation, you need an experienced Florida divorce lawyer to give you the advice that you need. Contact Vanessa L. Prieto in Fort Lauderdale and learn how we can help.