Getting Divorced When You Co-Own a Business with Your Spouse

 Posted on January 13,2022 in Divorce

Starting a family business can be a wonderful way to combine working and spending time with your loved ones. When a married couple owns a business, they may not give much thought to who owns what share of the business. After all, they are in this together. Unfortunately, spouses who co-own a business may find themselves facing significant, complex issues during divorce.

If you are getting divorced and you and your spouse own a business together, you have several options: You may sell the business and split the proceeds, assign ownership of the business to one spouse, or continue running the business together. Which option is right for you will depend on your unique circumstances and long-term goals.

Running the Business Together After Divorce

Even if you and your spouse are not romantically compatible, you may still be great business partners. Though rare, some divorced couples continue running a family business together after divorce. Doing so many be complicated on both a practical and financial level. However, for some couples, this is the best option available. If you want to co-own the business with your ex after the divorce, work with your divorce lawyer and a financial expert to ensure you put the proper legal and financial precautions in place.

Selling the Entire Business

A huge part of the divorce process is the division of joint assets and debts. If your marital estate contains significant debt, you may want to sell the business and use the proceeds to pay off this debt. Even if you divide marital debt between you and your spouse during your divorce, creditors may still pursue you for payment of your spouse’s unpaid debt if he or she stops paying. Selling the business also gives you an opportunity for a fresh start. Have the business professionally appraised and consider the pros and cons of selling the business so you will make an informed choice.

Buying Out Your Spouse’s Share of the Business

A popular option for joint business owners during divorce is for one spouse to buy out the other spouse’s share of the company. One spouse may decide to keep the business while the other spouse keeps the house, vehicles, or other marital property of equal value. If you have the funds to do so, you can also buy the other spouse’s share outright.

Contact a Wheaton Divorce Lawyer for Help

Divorce is already challenging enough. Dealing with a family business during divorce is even more difficult. At Hensley Sendek Law, we know what you are going through, and we are here to help. Experienced DuPage County divorce attorney Jessica Sendek can provide the dependable guidance and legal representation you need. Call 630-358-9029 for a confidential consultation.

Source:

https://www.ilga.gov/legislation/ilcs/ilcs4.asp?ActID=2086&ChapterID=59&SeqStart=8300000&SeqEnd=10000000