Family attorneys fight hard for their clients, and they often have to help those clients navigate difficult situations. Perhaps you are divorcing your spouse, and you need help securing your financial future through alimony. Or maybe you are trying to adopt a child who has been the victim of abuse, and you need a lawyer to guide you through the legal process of gaining guardianship. A good family lawyer does not just help their clients navigate the law; they help their clients move forward into better life situations. We appreciate the work these attorneys do, and we have dedicated this blog to spread the word about their profession.
As you go through a divorce, you may wonder what will happen to your family business. The fate of a family business can vary depending on how it is funded and managed and where you live. If you are concerned about retaining control, you should speak with a family lawyer before finalizing your divorce.
Determine Who the Business Belongs To
You must determine if your business is considered marital or separate property. Marital property is any property or asset that was acquired during the marriage unless it was inherited, gifted, or excluded by a prenuptial or postnuptial agreement.
Separate property is any property or investment that one party owned before the marriage or acquired after the date of separation. In some cases, the judge might consider it both separate and marital property if it was started before the marriage but increased in value during the marriage due to the other spouse's contributions.
Have the Business Appraised
It's essential to find out how much your business is worth. To do this, you must hire a professional appraiser. The best way to find one is to consult with your family lawyer.
Decide How to Divide Your Business
Once you have determined how much the business is worth, one of the more challenging steps is determining how to divide it. In most cases, you cannot split the company into two. You may choose to sell the business. Another option is a buyout in which you or your spouse is compensated for half of the business.
Consider Working Together
If you have a good working relationship with your spouse, you can continue to co-own the business if it is in your best interest. However, you might believe the company is not profitable or does not want to run it anymore. In that case, you may dissolve it. Each of these options has pros and cons.
Consult with a Family Attorney
If you hire a family attorney, you might discover that your divorce is more streamlined because you will make fewer mistakes. There will be fewer delays. You will receive straightforward and objective advice that is grounded in legal theory. If you end up litigating what happens to your business in court, the family attorney will even represent you in court. Because divorce is such a stressful process, you probably can't wait for the process to be over so you can move on with your life.
Reach out to a family law firm to learn more.