Divorce is a complex process in itself. When a divorcing couple owns a business, it can become even harder.
If you are contemplating divorce or are beginning the process, there are a few facts that you should be aware of.
The court determines the validity of divorce terms in accordance with the law of the state. Therefore, it would be beneficial for you to become familiar with Pennsylvania's marital laws. Whether you and your ex-spouse develop your own agreement or receive a court settlement, the terms must align with the law, or they will not become binding.
There are a few ways that you and your ex-partner may choose to divide a business. If the two of you are on amicable terms and work well together, you may decide to maintain the business together. For future reference, it may be beneficial to get your business terms in writing.
On the other hand, if you cannot work together, you may choose to sell the business to another party, or one party may buy out the other partner and maintain the business that way. If you choose to sell the business, you should understand that the process can take a while, which would prolong the payout.
If you and your spouse choose to sell the business, whether in whole or in part, an appraisal is an essential part of the process. A proper appraisal provides the actual value of the business. This helps the court in deciding how to split the business, or it can assist you and your former partner in negotiating the sale of the business. Either way, it can be beneficial to have a certified business appraiser to complete the appraisal.
These are just a few of the important details to consider in regard to the effect of divorce on a business. For more information and clarity on the best option for you, consider consulting with a knowledgeable attorney.