What You Need to Know about Divorce for Business Owners

What You Need to Know about Divorce for Business Owners

When it comes to divorce, the division of marital property tends to be one of the most challenging terms to resolve. If you own a business, however, you can expect the matter to be that much more challenging. If your divorce involves business ownership, you need a dedicated Illinois divorce attorney – who has a wealth of experience successfully guiding complicated cases like yours toward optimal outcomes – on your side.

Business Ownership

If you own a business, it’s very likely your most substantial marital asset, but there is a lot more to the issue than that. To begin, it’s important to address the fact that if you started or purchased the business while you were married, it will need to be addressed directly in the division of your marital property. But even if one of you owned the business prior to marriage – and kept it separate throughout – any increase in its value is a marital asset that must be addressed. 

Further, keeping a business separate over the course of a marriage can be exceptionally challenging, and all the following can weaken its classification as separate property:

• If marital assets were used to grow or maintain the business
• If the business borrowed money from marital accounts
• If the spouse running the business failed to pay himself or herself a fair wage (thus straining the family’s income)
• If both spouses contributed to the success of the business 

Valuing the Business

While dividing the value of a shared business in an Illinois divorce is necessary, selling the business in order to do so generally isn’t a great option. This means that one of you will need to be paid for the share of the business that you are walking away from, and obtaining a valuation that you are both willing to sign off on can be another challenge. The spouse who is keeping the business would naturally like to keep its value low, and the spouse who is walking away is looking for the business’s top value. Your options regarding this valuation include agreeing to hire a business valuator together or hiring your own business valuators and hammering out a value from here. 

Additional Factors

If you and your divorcing spouse run a business together, divorce means that one of you might not only be walking away from that asset but also that you might give up your current income and career. In other words, there is often a lot more to consider than just the value of the business and how it will be addressed.    

It’s Time to Consult with an Experienced Illinois Divorce Attorney

The trusted Illinois divorce attorneys at the SAM LAW OFFICE, LLC, have considerable experience handling complicated divorce cases like yours (that involve business ownership), and we’re here for you too. Your case – and your financial rights – are too important to leave to chance, so please don’t wait to contact us for more information today.