Dividing the family business during a divorce

It can be a challenge for a Connecticut couple to determine how they are going to divide their business during a divorce. The divorce process already has enough emotional challenges on its own. When a couple throws in a business that both of them may have been emotionally invested in, the challenges can skyrocket.

Before making any decisions, a divorcing couple needs to sit down and get the facts. The most important fact is the exact value of the business. Until they have this information, they do not know what they are trying to divide. Next, each party has to determine what they want from the business. Does one individual want to run the business while the other one simply wants financial compensation for the part of the business they owned? Answering these questions will help a divorcing couple make decisions about what to do next.

After evaluating the facts, some divorcing couples feel that it is best for one party to own the business and the other party to get bought out. Depending on how this process is carried out, there may be some tax benefits for both parties.

In some cases, each spouse is so invested in the business that they don’t want to give it up, so they may decide to continue to work as business partners after the divorce. Understandably, there are some emotional challenges that may arise. Couples will need to think carefully about whether this is the right decision for them.

The third option is to sell the business and divide the proceeds. This option makes it possible for each individual to move on, and they can choose to reinvest in a new business or retire.

It is not always easy for a divorcing individual to determine how to handle financial situations like dividing a business. This is where a family law attorney may be able to help. Family law attorneys may provide their clients with advice on financial matters related to divorce. Questions that they may be able to answer include how to divide the joint property, how to handle joint debt and how to determine the value of assets owned.