How Will Divorce Impact Our Shared Business?
Divorce can be difficult, even in the best of circumstances. However, it can be much more problematic when couples own a business together. There are many personal issues that must be resolved during a divorce, and added to these are the many business matters that need to be discussed.If you share a company with your spouse you may wonder, how will divorce impact our shared business?
Potential for Turmoil and Unintended Consequences
Many couples start businesses together. Very few take steps to safeguard their interests should they divorce. If you decide to divorce, there are many decisions that must be made which will impact the business. Generally, a couple’s assets and debts are considered community property, and are owned equally by both parties. A couple has several options including selling the business, keeping the business together, or allowing one person to buy out the other.
Keeping the Business Going Through a Divorce
One of the most difficult problems that business owners encounter during a divorce is keeping the business running properly. The couple is often preoccupied with the settlement terms and with various issues that arise. This can cause problems with the day-to-day operations of the business. If you are not careful, you can lose track of the important tasks and the business may suffer financially.
Preventing Problems with Your Business
Couples who own businesses together would be well advised to put an agreement in place that will establish guidelines should the couple divorce. Common problems arise over financial issues, especially how much each party put into the business and salaries. These issues should be reviewed and resolved before, rather than during, a divorce. This will protect you from losing your business if your marriage fails. It may be necessary to have a business valuation expert weigh in on the value of the business for purposes of one party buying the other’s interest or to determine what an appropriate value for the business is for a third party buyer.
Divorce is extremely complex when a couple owns a business together. There are many matters that must be discussed and settled. Call the knowledgeable divorce lawyers at Udall Shumway PLC to schedule a consultation to discuss your case.
This blog should be used for informational purposes only. It does not create an attorney-client relationship with any reader and should not be construed as legal advice. If you need legal advice regarding Will Divorce Impact Our Shared Business, or other family law issues, please feel free to contact Lindsay A.M. Olivarez at 480.461.5300, log on to udallshumway.com, or contact an attorney in your area. Udall Shumway PLC is located in Mesa, Arizona and is a full service law firm. We assist Individuals, families, businesses, schools and municipalities in Mesa and the Phoenix/East Valley.