You’re a business owner, but not on your own. You and your spouse had the idea to start the business together after you got married. For the next decade, you worked together as joint business owners, much as any other business partners would do – except, of course, for the fact that you were married.
This can become problematic if you then decide to get a divorce. What happens to the business? What happens to your career? What do you deserve to get out of the marriage? Your asset situation is simply much more complicated than someone who brought in earnings from another source. So what are your options?
2 ways to sell the business
First and foremost, there are two different ways that you can sell the company. The first option is to choose a third party. This could be an employee who works at the business, a third business partner or someone else entirely. If you and your spouse are successful in selling your company, then the money that you make in that sale becomes a marital asset, and the two of you can just split it up as you divide your other property.
If one of you wants to keep the business, there are still ways for the person who does not want to keep it to sell their share. Maybe you’re happy to move on, but your ex still wants to run the company. You know that this means you can’t sell it to a third party, but you’re still entitled to half of the value of the business. Your spouse may need to pay you off to buy out that share and run it on their own.
You can work together
A non-traditional option that sometimes works is when people decide to continue working together even after divorce. You and your spouse don’t have to sell the business, you don’t have to start other careers and you don’t have to lose everything you’ve built up since the day your company first opened its doors.
There are obviously going to be a lot of hurdles that you need to overcome if you do this, and it is not for everyone. If you do decide to go this route, make sure that you and your spouse set up a partnership agreement clearly defining your roles in the company as it is defined after your marriage.
All told, if your situation gets complicated you want to make sure you’re protecting your assets, you need to know about all of the legal options you have.