A divorce can be an emotionally and financially exhausting process. For those who own a family business, decisions involving that company may complicate property division negotiations. Florida residents who own a business are likely concerned about the best approach to dividing their assets when a marriage ends.
Operating a business requires a significant investment of time, energy and assets to ensure its success. When a divorce becomes the best option for a troubled relationship, the question of how to handle that business may be a difficult one to resolve. The first step is obtaining an accurate assessment of the value of the company. After that, there are three options that may be considered — the first being that one spouse will retain the company by buying out the former partner’s share. This option is the most popular, as it is usually tax neutral and allows the company to continue.
If one spouse lacks the liquidity to purchase the shares outright, an agreement for settlement payments can be drawn up that will avoid the possibility of capital gains tax consequences. A second option for couples who remain cordial is to continue operating the company together after the divorce. This may not be an attractive option for the majority of owners, as it is often difficult to work with a former spouse.
The final solution is to sell the business outright. While this may be best for many owners, it can lengthen the divorce process, as selling a business takes time. Once the company is sold, the spouses can split the profits and use them as they see fit. One of the most important considerations for Florida residents who are seeking a divorce is the property division, because this may help determine their financial stability in the future. An experienced attorney can help ensure that a settlement agreement allows one to reach future financial goals.
