Dividing Businesses In Divorce
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Dividing Businesses Assets During A Divorce
If you or your spouse owns a business, obtaining an equitable division of its value may be the most important financial issue in your divorce. To ensure that you receive everything you are entitled to, it’s important to consult an attorney who understands how businesses are valued.
At Rowe Law Offices, P.C., our attorneys work with forensic accountants, business valuation experts and other professionals to protect your financial interests in divorce. We offer a free initial consultation to discuss your case. From our offices in Wyomissing and Lancaster, we serve clients in Berks, Lancaster, York, Schuylkill and Lebanon counties and the Lehigh Valley.
Is A Business Considered Marital Property?
Unless you and your spouse have a prenuptial agreement that says otherwise, a business is marital property and is subject to division if it was started during the marriage. Even if the business was started before the marriage, any increase in its value during the marriage may be subject to division.
Selling a business and dividing the proceeds during your divorce may not be practical or desirable. As a result, a buyout, asset swap, alimony or other financial arrangement may be used to provide the nonowner spouse with his or her share of the value of the business.
If the spouses jointly operate the business, it is important to spell out each party’s rights and interests in the divorce settlement to prevent disputes later. While some divorced spouses continue to operate businesses, buyouts or other arrangements are common.
Not every business has value. For example, a consulting service operating out of the owner’s home may not have value if the enterprise cannot be sold.