If you and/or your spouse own a business, it can complicate your divorce. For some, the business is a source of financial and marital stress. For others, it is the only thing holding the family together and a huge source of pride and accomplishment. Sometimes one spouse wants nothing more to do with the business and other times both spouses are deeply invested in the success of the business. While houses, cars, and bank accounts are fairly straightforward to value or appraise, a business is more intricate.
Scope of the Impact
If you and/or your spouse own the business with other family members or business partners, these individuals will also be impacted by the decisions made in your divorce. It is likely they will also feel some anxiety about your divorce. If the business is owned with family members there may be some argument that the ownership interest was gifted or inherited by the spouse with the ownership interest.
Wisconsin courts are tasked with fairly and equitably dividing each spouses’ interest in assets and debts. This includes business interests. One of the first steps will be accumulating documentation necessary for establishing a value for the business interest(s) you and/or your spouse have. The value used should reflect the fair market value of the business.
However, the devil is in the details, and determining fair market value can be knotty. It is usually most efficient to seek the advice of specific trusted financial and tax professionals who are neutral and can provide accurate unbiased information about the value of a particular business interest. These financial professionals along with your legal professionals will be able to offer suggestions on how to divide the equity in the business in such a way that protects and minimizes any impact on the business.
In the end, valuing and dividing a business interest is a combination of art and science. If you find yourself contemplating a divorce and you own a business, come talk with us. We have a team of family law and business attorneys that work collaboratively making us uniquely qualified to handle your situation.
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