Property division is always a top concern during the divorce process. When the divorcing couple owns a family business, dividing the business and their property can be complex but it is important for the divorcing spouses to be prepared for what to expect so they can protect their interests.
When a family business is part of the property division process there are certain considerations that will need to be addressed. They can include the valuation of the business; the continued ownership of the business; an evaluation of any business debts or business tax debts; the discovery of any hidden assets; and the future of the business. Divorcing couples may choose to handle property division of a family business differently based on their desired outcome.
In some instances, the divorcing couple may decide to sell the business and divide any proceeds from the sale or in others, one of the spouses may buy the other spouse out and solely own the business going forward following the divorce. In addition, some aspects of dividing a family business may seem simple but may also not always be straightforward. As a first step, it is important that the business is properly valued which may require financial and accounting experts.
Divorcing couples who have a family business to divide can benefit from trained guidance throughout the property division process and the division of their business. In some circumstances, the divorcing couple may be dividing their life’s work which is why they should ensure the valuation of their business is done right and they know what to expect from the property division process.