Business Owner’s Divorce
For business owners, divorce is complex emotionally and financially in a variety of ways. To protect your interests and preserve your peace of mind, you need to work with a divorce attorney who understands the complexities and has the ability to develop the best strategies to address the full range of potential consequences.
Naimi Family Law Group frequently works with the owners of closely-held businesses to preserve the value of the business during the divorce process and devise plans to continue operations according to their unique objectives. We understand that your business is far more than just an asset, and we help you protect the investment of time, energy, and resources you have devoted to the cause.
Community Property Laws Affect Business Ownership
Even if you started the business before you got married and even if your spouse never worked in the business, that spouse is still likely to have some ownership interest in the business unless you created a pre or postnuptial agreement specifying that the business interests remain your separate property. Property owned during the course of a marriage belongs equally to both spouses under Nevada’s community property laws. So at the very least, the increase in business value during the marriage would be community property that would be divided in divorce.
If your spouse worked for the business, that could increase their ownership share. But if your spouse focused on home life or worked at a job with benefits so that you could focus on building your business, that is also a form of contributing to the business, so they are likely to have a share in it.
Valuing and Allocating Interests in a Business
One critical task in a divorce where one or both spouses own interests in a closely-held business is establishing the appropriate value for that business. In many cases, it makes sense to consult a neutral third party financial expert to establish values for various aspects of the business. In particular, you need to make sure the value of intangible factors such as business goodwill are valued properly.
Once the interests are valued, you should be prepared to make your best case to show why you are entitled to receive your fair share of that business. Consider all the ways you have contributed to the value of the business. Assuming you do not want your former spouse to have any control over the business after the divorce, you will need a solid plan to buy out their interests. If you have other partners in the business, your partnership agreement, buy-sell agreements, and other controlling documents will also affect how your business will be handled in divorce.
Work with an Experienced Divorce Team to Protect Your Business Interests
In some ways, handling a business in divorce can be as much as a custody battle as a financial matter. You need to protect the welfare of the business in addition to working toward your objectives.
The knowledgeable team at Naimi Family Law Group is prepared to help with all aspects of divorce, including preserving your business and developing the best plan for the future. For a confidential consultation to learn how we help you refine and achieve your goals in divorce, contact us today.