Separating Business From Divorce
Just like with marital property, your business will be considered an asset. Like all other aspects of a marriage, including child custody and alimony, there will need to be an agreement made about your shared business.
Some couples decide to treat their business as they would a house: either one spouse remains while the other “moves out,” or they decide to sell the house.
Below we discuss what options you’ll want to consider when it comes to your shared business.
1) Two of you decide to remain as co-owners of the business. Depending on your relationship, this might be a great solve or the worst thing ever. Keep in mind that this will require you to be in constant communication with your ex, even after the divorce is final. If that sounds terrible to you, this option is obviously not advised.
2) One spouse buys out the other spouse. If this is what the both of you decide, then it’s advised that you hire a business appraiser to perform a valuation of your company. Once the business is evaluated, you know how much it is worth and one spouse can either buy out the other one, or use other assets for an even exchange.
3) Sell the business and then split the proceeds. This is often advised for marital property such as homes, and it makes sense in this scenario as both spouses are able to move forward equally, without any past ties remaining. Of course, this might seem an out of the question option if the business is performing well, and both spouses are attached to the business.
In addition to determining what you will do with a shared business, you will also need to understand marital property division, and what is considered community or separate property.
Keep in mind that you are allowed to divide your marital property any way you’d like to. The only reason your state laws might play a role is if you and your spouse cannot agree to how the property will be divided and you need to go to court.
Regardless of how your marital property is divided, you need to protect yourself. Your ex might not make the payments for various reasons – lack of money, spite, illness. In that case you might need to return to court or various other means of collecting the lost payment.
Because of that, it’s often advised that you protect yourself by getting cash in hand once the divorce agreement is reached. If it’s decided that your ex will pay you out following the sale of an asset, wait until the sale is final, and then ensure you get the money to finalize your divorce.
Divorce is not only an emotional event. It can also mean a shaking up of routine and finances. This is especially true if you have co-owned a business with your spouse and have now decided to sell the business.
Knowing that your financial picture will be changing will allow you to prepare for the financial changes that might be coming your way.
You’ll want to get your finances in order prior to starting the divorce process. This means understanding your assets and their values, as well as what is owned separately and jointly. Next, you’ll want to do the following:
Understand what your budget is now, and what it will be following the divorce.
What are the big changes? Will you need to make changes?
Get all your bank statements and records together. You’ll want to provide this to your attorney.
Get copies of all joint tax returns. This also includes checking that your taxes are up to date.
Do not transfer any jointly owned assets.
Don’t make any large purchases.
Do not agree to distribute any assets until you consult your attorney.
Your divorce settlement can either mean more money coming your way, or less. Either way, you’ll need to create a new plan for it. This might mean you need to take on a job if you didn’t have one during the marriage.
Any debt you have agreed to take on will now be solely in your name. Make sure that you have both removed the other spouse’s name from any agreements or debt contracts.
You might also be receiving or paying alimony. If there are children involved, you’ll need to understand how much money is allotted to them and for what types of things. Additionally, you’ll need to speak to Anthony Moreno about tax laws regarding alimony payments and child support payments.
If you are facing a divorce, you need to work with a Kansas City divorce attorney that can take a look at your specific situation and advise you on all the aspects of dissolution (divorce) you will be facing. This might mean decisions regarding retirement funds, property, child support and custody, and alimony.
Anthony Moreno can work with you to help you decide how you want to tackle these elements of your marriage and divorce, while also providing guidance and support. He will be able to lead you through the process while keeping you from procrastination and caving into pressure. He will also be able to help ensure you meet all the required timelines while ensuring that you get a fair case and trial should you need to go to court. Lastly, Anthony will be able to help you find the freedom and new life you are seeking – one that is entirely on your terms.
Contact Anthony Moreno at (816) 200-0467 for help right now!