Starting a business together with your spouse is one of the most exciting moments you can share together. Planning, developing, and bringing to life what was just an idea is such a rewarding experience and one that is filled with optimism and energy, especially in those early days. As you know, it has to be if you want to truly get your business off the ground and running.
But for some, there comes a time when that optimism wanes and your relationship with your spouse turns sour – or you simply decide to go different ways. When divorce becomes inevitable, it can be difficult to maintain a professional and successful business relationship. So what happens to your business when you decide to get a divorce?
Understanding Business and Marital Assets
When businesses are part of a divorce, the courts must decide if the property is a marital or separate asset. At a very high level, businesses acquired during the marriage and with joint funds are considered marital assets, and ownership that was acquired prior to the marriage are considered separate, though not always, especially if the net worth of the business grew significantly during the marriage.
How the business is handled as part of the divorce is one component of the process. Additionally, the couples must also decide how they want to handle the dissolution of their business if they choose to dissolve it.
As a co-owner of your business, you have the choice to continue the business partnership as is even after divorce. Alternatively, you may choose to buy from or sell to your ex your half of the business, or you may choose to sell the business in its entirety and split the profits with your ex.
If retaining ownership of the business after divorce is important to you, there are certainly ways to make that happen. Get in touch with an experienced business attorney and don’t hesitate to reach out to us for guidance with your divorce and business questions as we well.