Families that operate a business are often faced with a set of difficult decisions when a divorce arises. At Lois Kulinsky & Associates, Ltd., we know that you might have to consider the following:
- Keeping the business open
- Choosing the person to run the business
- Shutting it down and dividing assets
- Determining the true value of the business
According to Entrepreneur Magazine, there are a few things a business owner can do in order to protect the company during a divorce, starting with getting an accurate valuation. Experts suggest using a court-appointed and neutral professional to do the job, and then bringing in a third party to review the numbers before moving ahead with it.
Additionally, owners should keep family and business finances separate. Small business owners may blend accounts or borrow from one to pay something for the other, but experts say this can muddy the water if a divorce presents itself.
Another strategy that some people employ is to give up other assets in order to keep total ownership of a company. For example, you may choose to allow your spouse to have the car or a house if you can retain the business.
Depending on the value of the company, it is possible that a spouse may be owed a significant amount of money. In some divorces, couples will arrange for that amount to be paid over time, which can ease the effect the settlement has on the company.
It is clear that businesses can complicate divorces, but working with the right professionals can help you protect the company and your stake in it. For more information on this topic, please visit our page on business assets.