When you put your blood, sweat, and tears into building a company, the last thing you want is for your business to be at risk in a divorce. Sometimes, your spouse may be entitled to a portion of the business. If you’re facing the end of your marriage, you must consult with a divorce attorney about protecting your business interests.
A business that started during a marriage or with marital funds to finance could have division implications. However, there are steps you can take to try to keep complete control of the company. The following blog describes the steps a business owner can take to ensure their business is not absolved, liquidated, or sold under varying circumstances.
Whether or not a business is considered marital property can significantly impact the outcome of the divorce. As anyone who has gone through a divorce can attest, dividing up property can be complex and contentious. Businesses are often a significant source of conflict, as they can be pretty valuable and may represent years of hard work.
According to Illinois law, if a couple starts a business during the marriage, it is automatically considered marital property. The rule still applies regardless of whether the spouse owns any portion of the company. Even if one spouse owned the business before the marriage, any increases in its value during the marriage might be considered marital property. The spouse has a claim against the company and may be entitled to a portion of its value.
Businesses can be complex assets, and it is essential to get a professional valuation to determine their value accurately. When dealing with such a valuable asset, it is best to consult an experienced business divorce attorney to protect your interests.
Generally speaking, there are four major exceptions to marital property, including the following:
Understandably, courts typically attempt to limit damage to businesses in the case of a divorce; there are situations in which a spouse who is not an owner can actively hurt the company. For example, if a spouse who is not an owner of the company calls customers or comes to the office and misbehaves, they may be at fault for trying to retaliate against the other spouse for personal reasons.
These actions could hurt the business asset’s value and the source of future income. If you employ your spouse and they engage in this behavior, termination is an option. However, consulting with an attorney beforehand is essential to ensure that you take the appropriate legal steps.
The end of a marriage is a stressful and emotional time for all parties. In addition to the personal toll divorce can take, there’s also the possibility of losing your livelihood. Separation and divorce are made all the more complicated if you own a business or multiple businesses. If you’re facing a divorce, you must talk to a divorce attorney as soon as possible. They can help counsel you on your best options for keeping your business intact and minimize the damage divorces often incur.
At Sabuco Beck, PC, we understand how complex divorce can be, especially when business ownership is involved. That’s why we offer a full range of support, from divorce lawyers to real estate professionals. We can help you navigate the process and come out on the other side with your business intact. Contact us today to learn more about how we can help you through this difficult time.
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