For couples that work together, they face unique legal challenges pertaining to the division of business during the Illinois divorce process. Oftentimes, this occurs when the divorcing couple owns a business together. Alternatively, one spouse may own the business prior to marriage.
Similar to other aspects of the divorce process, the priority falls on preserving the business. Mediation and Collaborative Divorce help couples to achieve this goal.
Division of Business Through Mediation or Collaborative Divorce
When spouses own a business, it likely represents a large source of income for the family. In traditional litigation, both spouses may hire their own experts to value the business, which can be very costly. The spouses often fight over the business’ worth. In a worst-case scenario, the divorcing couple fights to the point of the business’ dissolution.
That result can be prevented through Mediation or a Collaborative Divorce. The focus centers on keeping the business and helping it continue to thrive if that is in the best interest of the entire family.
Hiring Neutral Finance Experts
First, a neutral business evaluator examines the relevant documentation. Next, the evaluator indicates the business profitability. Usually, this entails the business history, future, and its valuation.
Overall, this process requires full transparency between both parties. Thus, the evaluator ensures an accurate assessment of revenues and expenses. It must be determined if the business can be maintained by one or both of the spouses if both were working in the business prior to the initiation of the divorce, or what should happen with the business.
Common Division of the Business Options
Throughout the Illinois divorce process, a division of business usually takes one of four forms:
- One spouse buys the other out of the business.
- The spouses trade business assets for other marital property, including real estate and retirement accounts.
- The parties agree to continue working together in the business.
- The parties sell the business.
When the parties are willing to discuss and review these options in order to preserve the business during the divorce process, the solution can be a win-win for the family.
For legal guidance through the Illinois divorce process, contact the family law firm at Bruckner Hernandez Legal Solutions, LLC.