Want to make divorce even more complicated than it usually is? Just try getting divorced when you and your spouse own a business together.
In many ways, splitting up with a business partner, even if the two of you are not related in any way, is much like a divorce. You have to decide how to divide your interests in the company, if one of you gets to keep the business, if you both need to sell, and what the real value of the business is on the open market.
When you have a family business, you have to do all of that while also navigating issues like property division, child custody, alimony and much more. It's tough. Here are a few things you should know as you get started.
You can buy the entire company
Just like a family home, you and your spouse both own the family business together. That makes it an asset with a direct financial value. If you can afford to do so, you can buy out your spouse's half to keep the company yourself.
For instance, maybe the company is worth $2 million. You have expenses and debts, of course, but you figure you'd make $500,000 if you sold it outright. Split in two, that means you have $250,000 of value in the business and so does your spouse. You can pay them their half to take over complete control.
Of course, the exact numbers are different for everyone. They also lead to a lot of debates. It's best to have a professional valuation done.
You don't have to change anything
Do not assume that you have to end your business relationship just because you decided to end your romantic relationship. They're two entirely different things. Legally, they do not have to overlap and you can keep things exactly how they are.
Of course, that means running a company with your ex. Is that something you can handle? Some couples can, but it's not for everyone.
You both have roles and value to the company
One thing to consider is that you both bring unique skills and abilities to the company. You do things that your spouse does not.
If one of you leaves the company, does that leave a hole that the other person can't fill? Say you keep the company; do you need to hire someone to do your ex's job? Do not just assume that you can run the company on your own without a problem after the divorce.
That's another reason couples opt to work together, even after divorce. They need one another.
A complicated process
No matter what you decide, this can get very complicated. With so much at stake, make sure you know what legal options you have.