If either spouse starts a business during the marriage, the firm is likely a marital asset subject to equitable distribution during divorce. More marriages than ever have business equity to consider since more than 500,000 new businesses start each month.
Divorcing spouses must investigate their preferred way to allocate the company.
Operating the business together
The current era leads to people “uncoupling” in more collaborative ways. A pair that is not a good romantic couple may still function well as business partners.
A court would rarely render a decision for divorcing spouses to continue a business together, so splitting couples need to mediate how to divide business responsibilities if they so choose. Even in the most respectful and civil of splits, partners need to put every conceivable detail and commitment in writing to avoid future difficulties.
Liquidating the business
If neither partner wants to continue the business or can do so, selling the company and splitting the proceeds may be a solution. It may be challenging to find a buyer, prolonging the divorce process. Spouses may wish to rely on a broker to expedite the process.
One spouse buying out the other
A buyout is often the way spouses distribute a business during divorce. The buyer can use personal funds from nonmarital assets for the purchase. Doing so may be difficult since assets gained during a marriage are almost always marital assets under Florida law. The buyer could sacrifice other marital assets to purchase the other’s stake in the business, using items such as a stake in a home or their portion of funds from an account.
A business adds weighty considerations to the asset split during a divorce. Individuals who soberly examine the options can rationally evaluate the pros and cons of each method.
