If you are facing divorce, you may have significant assets to divide with your soon-to-be ex-spouse. If your family business is one of those assets, its fate may be the most important consideration when you reach the property division stage of the divorce proceedings. Here are three options to think about.
1. Put the business on the market
Even if your family has owned the business for years, you may want to consider selling it outright. You should first enlist the services of a professional appraiser who will perform a valuation to determine the appropriate selling price. If the business is profitable, you will probably have no trouble attracting a suitable buyer. Once the business sells, you and your spouse can split the profits, which may be significant.
2. Agree to a buy-out with your spouse
You may have more to do with operating the company than your spouse does, even if you are co-owners. If the business is more important to you, another option is to offer to buy your spouse out. You will still need an appraiser to place a valuation on the business for the purpose of establishing an appropriate price. You may be able to come up with the necessary funds, but if not, you could give up certain other assets to your spouse for an even exchange. Of course, this option could work the other way around as well: Your spouse could offer to purchase your half of the business.
3. Continue to operate the business together
You and your spouse may have spent many years together as co-owners of the business, and neither of you may want to give it up. If you both feel you could continue working together in the post-divorce era, continuing as business partners may be your best option.
Seek professional help
If you both decide to continue as business partners, you would not need to go to the expense of hiring a business appraiser. Still, no matter which of the three options you choose relative to the fate of your business, you should make sure you have all bases covered by relying on a team of professionals, including a CPA, a financial planner and an attorney.