How Do I Protect My Business During Divorce?

How Do I Protect My Business During Divorce?

Nov 02, 2022

It is impossible to deny how stressful and challenging divorce is, but if you own a business, you can count on it being more so. Because protecting your ownership and your business’s value throughout the divorce process is paramount, you shouldn’t wait to reach out to a seasoned Michigan divorce attorney who has considerable success guiding complex cases like yours toward optimal outcomes. 

If Your Business Is a Separate Asset

If the business in question is yours alone – which means that you brought it into the marriage with you and kept it separate throughout or that you purchased it with separate funds and kept it separate while you were married – it may remain your separate asset, but you’ll need to keep all the following in mind:

  • Any increase in the value of your business over the course of your marriage is a marital asset that will need to be addressed in the division of your marital property
  • If you used marital assets to help grow your business or failed to pay yourself an adequate salary – thus keeping funds from your household – it can weaken the dividing line between separate and marital. 

If Your Business Is Marital Property

If your business is marital property, you’ll need to address the matter of dividing its value between you equitably upon divorce. Selling a business for the sake of divorce generally means taking a financial hit, and if you’re fully invested in continuing to run your business, this isn’t a good option to begin with. There are, however, alternatives to consider, including:

  • Buying out your spouse’s ownership in the business outright by obtaining a loan
  • Allowing your spouse to take their value in the business in the form of other marital assets
  • Buying out your spouse’s ownership in the business over time

Having a Solid Business Valuation

One of the most important aspects of protecting your business in a divorce is having a solid valuation that reflects its true value and is difficult to refute. A business’s value is a common sticking point in divorce, and having a well-considered valuation at the ready can go a long way toward supporting your position. With a recent valuation in hand, you’ll be well prepared to strategize the best path forward.  

Work Closely with a Seasoned Divorce Attorney

You’ve worked hard to start and grow your business, and protecting it throughout the divorce process is key. One of the most important steps you can take in your efforts to do so is carefully addressing the matter with your trusted divorce attorney from the outset. 

You Need an Experienced Michigan Divorce Attorney on Your Side

The practiced Michigan divorce attorneys at the Law Offices of Robbins & Licavoli have a wealth of experience helping clients like you protect their businesses in divorce, and we’re here for you too. To learn more about what we can do to help, please don’t put off contacting us today.

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