Divorce is a process that is both liberating and complex for a couple that accumulated several assets throughout a marriage. While many people often look no further than the family home or shared bank accounts during asset division, some divorcing couples have to make tougher choices that could influence their livelihood itself.
If you are a married couple that co-owns a local business, getting divorced could spell the end of your personal empire. Here’s a look at how Texas courts view businesses in a marriage and what options you and your soon-to-be-ex have when it comes to approaching this valuable piece of your marriage.
Is a Business an Asset in Your Divorce?
In short, yes, your business is completely an asset that has division potential during your divorce. Despite the love and personal attachment you may have as a co-owner of a business with a spouse, at the end of the day, you must always remember that it’s a tangible asset with a cash value attached to it.
Keep in mind, that if one member of the marriage owned the business before you said “I do,” it is considered separate property and is not divided up in your divorce. However, if that’s not the case and your business is community property, you and your divorce lawyers will have to make some serious decisions about the future of the company.
Could You Still Work as a Team?
One of the biggest questions you and your spouse must ask each other is if you can still remain co-owners and not a couple? Yes, this is an extremely rare outcome, but in the case of some amicable divorces, people can separate business and emotions.
Although this is a riskier and fine line to walk, couples should always keep this possibility in mind if both are extremely dedicated to the business they’ve built.
Is a Buyout a Possibility?
If one member of the marriage is adamant about continuing to run the business, it is always possible for them to buy out their spouse from the business. In Texas, the property is divided as equally as possible, so, the buyout would typically be for half of the market value of the business.
The only caveat to this solution is that the funds must be readily available, or the spouses must have agreed upon a structured settlement that allows for payments over a determined amount of time.
Selling Your Business is an Option
Finally, if neither party can afford a buy-out, the easiest option is to sell the business and evenly divide the profits. Keep in mind that typically the sales process of a business isn’t always the swiftest process, so the couple will have to decide on a plan as to how the business will be managed until a final sale occurs.
Make the Right Divorce Decisions with the Help of Nilsson Legal Group
If you have questions regarding what to do with your family-owned business during a divorce, or if you just need a great Fort Worth divorce lawyer on your side, Nilsson Legal Group can help.
We are a team of family law attorneys that have experience in all aspects of amicable and contested divorces. No matter what you hope to gain from your separation, we can help make your ambitions a reality. Contact us today to schedule your free consultation with a member of our team.