Many married couples are self-employed. They started a small business during their marriage, a business which with sweat and toil has become something, such as a respected restaurant, well-known car dealership, or popular golf course. Divorces become more complex because of this asset.
To whom will the court award the business? Will the court allow the other spouse to stay involved in the business after the divorce? If I leave the business and my spouse receives it, can I retain an ownership interest after the divorce even if I am no longer involved in the daily operations? How is a business valued? For divorce purposes, are there different methods for valuing a business or just one? Which valuation method works in my favor? If the business is expected to grow rapidly, can I defer having the business valued until later, until after the divorce? What if we made personal loans to the business, to whom will the court award the loan payments?
In many cases, only one spouse is involved in the business. Perhaps the business has been struggling, yet my spouse will not give it up and go find better employment. Will the court use the low income as my spouse’s “salary” when determining spousal support or alimony paid to me? Or will the court assign my spouse a higher earning capacity for the alimony calculations?
Perhaps your spouse started the business before marriage. With your help during the marriage, the business really took off. How is the business valued in those circumstances? Do I still have a right to half (or higher) of its value?
These are just a few of the issues which are frequently raised in divorces involving family-owned businesses. Our firm is well-equipped to address each of them. We have significant experience in this area and have a team of other professionals, such as valuators and forensic accountants and tax experts, to help assess and value your business. We strive to lead you through this complex area in a way that answers your questions and gets you the dollar value and business interest to which you are entitled.