Dividing a family business during divorce can be one of the most challenging and complex parts of the divorce process for a couple that owns a family business. There are several different ways to address division of a family business during divorce that the divorcing couple should be familiar with.
The family law process provides different options for divorcing couples to handle their family business and property division issues. Dividing a family business may be one of the most complex property issues that is part of an already complex process. During the equitable property division process, the divorcing spouses will each have to address what they want their ongoing role in the business to be and how to best financially divide the business amongst other overall equitable property division concerns.
The first option for dividing the family business is for one spouse to keep the family business. This option requires the spouse who will be keeping the family business to buy out the other spouse. If the spouse keeping the family business does not have the resources available to buy out the other spouse based on the appraised value of the business, a structured settlement can be developed for payment over time. The second option is for both spouses to continue to own the business which will require them to be able to amicably work together following their divorce. The third option is for the divorcing couple to sell the business and split the proceeds which can also make the divorce process take longer pending the sale of the business.
Whatever option ends up being the best for the divorcing couple to address dividing a family business up during their divorce, it will be necessary to conduct a valuation of the business which can be a complex process making it helpful for the divorcing couple to be well informed about what it entails. The process of divorce, property division and dividing a family business can also be an emotional one which is why it is useful to understand their options and the resources available to them.