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Family Businesses and Divorce

Posted on in Business Law

Arlington Heights business lawyerOwning a family business can be a tremendously positive influence in a person’s life. However, when a married couple who owns a business gets divorced, the process can become quite complicated. If you or your spouse own a family business and are considering divorce, you will most likely face additional obstacles that other divorcing couples do not face. Because of the complex nature of divorce involving a family business, it is highly recommended that you seek advice from a qualified legal professional.

Deciding Whether to Sell, Split, or Share the Business

Married couples who own a business have a few different options when they get divorced. Some couples choose to continue running the business together even after they are no longer legally married. While this may be the simplest option for some, other couples may not wish to continue as co-owners after getting divorced. Another option is for one spouse to buy the other spouse out. This can be a good decision when one spouse is already less involved in the business or wishes to pursue other career and business interests. Lastly, the couple can close the business or sell it.

Valuing the Business is Critical

Regardless of if you and your spouse choose to split the business or sell it, you will need to consult a financial professional who can value the business. It is especially important that this valuation is impartial and not unfairly biased toward one outcome or another. It is not necessary for each spouse to hire their own appraiser for business valuation. Neutral appraisers can advise a couple in this situation on a variety of issues including whether or not to consolidate your business to free up liquid assets. The American Institute for Certified Public Accountants (AICPA) offers business evaluation training for certified public accountants. A CPA may be able to help you with valuing your business and making decisions about the future of your business.

Property Division During Divorce Involving a Family Business

If you are like many married couples who co-own a family business, the business is your most valuable asset. If one spouse is going to be the sole owner of the business after the divorce, it is likely that the majority of remaining marital estate will be assigned to the other spouse. Some couples have provisions in their prenuptial agreement or articles of incorporation that expresses how the business should be taken care of in the event of a divorce. If these documents are valid, the court will go along with such provisions.

Contact a Cook County, Illinois Business Law Attorney

For quality legal guidance regarding your family-owned business, contact the experienced Arlington Heights business lawyers at A. Traub & Associates today. Call us at 847-749-4182.

 

Sources:

https://www.cbsnews.com/news/who-holds-onto-the-family-business-when-couples-divorce/

https://www.aicpa.org/interestareas/forensicandvaluation/resources/businessvaluation.html

Illinois State Bar Association DuPage County Bar Association Northwest Suburban Bar Association American Inns of Court DuPage Association of Woman Lawyers National Association of Woman Business Owners Illinois Association Criminal Defense Lawyers DuPage County Criminal Defense Lawyers Association
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