Starting a business with your spouse may seem like a good idea, especially if you’re looking to spend more time together or to control your income. It can become far less ideal, though, if things go sour in the relationship between the two of you. If you ultimately decide to divorce, then there are several options for how you can split up the family business.
Before you make any decisions about what to do with the business, you’ll want to have a third-party come in and appraise its actual value. After this occurs, you can start to decide whether to keep your business or to sell it.
Continuing to run the business may seem like the least complicated option from both a financial perspective and an emotional one. Neither one of you will have to accept a potentially inferior valuation that it may have been assigned to the business. You also won’t have to go through the stress of losing your company and marriage at the same time.
If you decide to continue operating the business with your ex, then you’ll need to establish new ground rules for doing so. This will ensure that your business continues to thrive even though your marriage didn’t.
Divorcing couples who struggle with the idea of continuing to run a business together may find it best to go their separate ways. One spouse may want to sell their rights to the business to the other spouse.
The best time to do this is after the appraisal has been completed. One spouse will typically agree to accept other property (such as the marital home or cash) instead of retaining their share of the business. Transfers that are incident to divorce often aren’t taxable, so that’s another incentive.
A third option that some divorcing couples may pursue is to sell the business outright. Spouses may opt for this to do something different or to retire. This process can take a long time, though. Husbands and wives will have to find a way to work together while they try to find a buyer for the business and this can delay their divorce.
There’s no one tried and true solution for handling every divorce. A property division attorney can explain how Florida’s equitable distribution divorce laws work and provide advice on how to proceed when a business is involved.
