Dividing assets in some divorces can be fairly easy, but there are other times when this task can be extremely complicated. If you are getting divorced and are trying to determine how to split up the business you and your spouse own, you might run into some challenges. When a couple owns a business and divorces, each spouse is usually entitled to 50% of the business. Here are some tips to help you get a fair division of a business you own with your spouse when getting divorced.
Obtain Copies Of Bank Statements And Financial Documents
If you were involved in the operations of the business at all, you may have a good idea how the business works and operates. Because of this, you might have insight as to the value of the company, as well as the way cash transactions are handled.
By looking at the bank statements, from the business as well as his or her personal statements, you may be able to unveil any cash transactions that were not run through this business. This is a great way to find out how much income the business is really making, and this is especially important for calculating child support.
In addition, the cash flow of a business also affects the value of a business. A business with a great cash flow may have inherent worth, simply because it is a profitable business.
Taking a look at the financial documents, receipts, and reports from the business is also a good way to find out if the business has recently purchased any new assets, which is helpful when deciding how to divide the business and its assets.
Get A Business Valuation Report
Getting a business valuation report is another good step to take during a divorce. This report will reveal the current market value of the company, and it factors in many things, including:
The amount listed on this report will give you leverage for negotiations, but you will have to decide how to split the business.
Decide How To Divide
Splitting a business is like splitting a house; you cannot cut it down the middle and give half to each person. You will have to decide if you want to continue working for the business or if you would prefer not having anything to do with it. If you want to continue working for the business, dividing it can be slightly complicated. You will have to agree on an arrangement for:
Another option is to have your spouse buy out your portion of the business, or you could decide to buy it out. This can be done after the valuation report is complete, and it would involve one spouse paying the other 50 percent of the business's worth.
There is also a third option, which involves selling the entire business and dividing the proceeds in half. This is the easiest way to divide a business, but it is not always the best route, especially when one spouse really relies on this business for his or her income.
There are many challenges involved during a divorce, but dividing a business is one of the more complex issues to deal with. Go to websites of law firms that specialize in divorce law to to learn more, and contact a family law attorney if you have specific questions.
Share31 August 2015
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