When it comes to the property division phase of your divorce, the business you and your spouse own will likely be the biggest asset. You have options in terms of deciding the future of the company, but first, you have to find out what the business is worth.
First things first
You must engage the services of a professional, such as a business appraiser or a forensic accountant, to place a value on your company before your divorce proceedings begin. He or she will have the experience to look over your financial records not only to determine what they show, but also what may be missing. Your spouse may have handled the financial side of your business partnership, so were there any loans or contracts you did not know about? The appraiser or forensic accountant will investigate anything that appears to be off base and arrive at the true value of the business.
The professional you hire will determine the value of computers and other equipment, the value of the building if you own it, and the value of any other associated real estate. He or she will look at the annual income of the business as well as the projected income. There are also intangibles to consider. For instance, how recognizable is your brand? This may add considerable value to the business.
Options to consider
In deciding the fate of the company, you have three main options: keep it and continue working in partnership with your spouse after the divorce, sell it outright and split the profit, or buy your spouse out. Conversely, your spouse could buy you out.
Finalizing the deal
If you decide to put your company on the market, the judge will have a say in dividing the spoils based on how much effort each of you put into running and growing the company. If your spouse wants to buy you out, he or she may not have the funds to do so. In that case, you may agree to accept another asset of like value in trade, such as a piece of real estate. There are legal options to explore to ensure the final divorce settlement is fair and you feel satisfied with the disposition of your biggest asset.