Will We Have to Divide Our Small Business in Our Illinois Divorce?

 Posted on May 04,2022 in DuPage County divorce lawyer

Developing a small business and making it successful is no easy feat, especially after the Covid pandemic caused so many small businesses to shutter permanently. After years of sleepless nights, endless work, and countless stresses, many small business owners are therefore rightly nervous about the prospect of dividing their marital property in an Illinois divorce. Unfortunately, handling a small business in a divorce can be nearly as complex as getting it up and running. If you own a company and are considering separating from your spouse, here are some things you should know.

Is My Small Business Marital Property?

As with most issues in the law, the answer is, “It depends.” Usually, however, if a business was created or developed over the course of a marriage, at least part of it is probably marital property. Well-written prenuptial and postnuptial agreements can protect a business from becoming marital property, but without such a written agreement, a business’s income, assets, and overall value that accrued during a marriage are likely not personal property, even if the business is in only one spouse’s name.

How Can We Divide Our Share of the Business?

Every couple’s situation is a little different, but there are some common patterns in how couples divide their share of a small business that is marital property:

• One spouse “buys out” the other spouse’s share by giving them cash or other marital property, such as equity in the marital home.

• Spouses sell the business and split the proceeds.

• Spouses continue joint ownership after the divorce.

The method that you choose in your divorce will depend on you and your spouse’s long- and short-term goals, the type of business you own, and how well you and your spouse can negotiate your property division.

How Do We Know How Much Our Business is Worth?

Determining the value of a business can be tricky but there are financial experts who specialize in assessing a business’s value who can help. If you and your spouse disagree about the method your financial expert uses or cannot agree on a settlement and the divorce ends up in trial, a financial expert may be called to testify about the business’s value and the method he or she used to assess it.

Call a Yorkville, IL Marital Property Division Lawyer

Complex issues of property division are far easier to manage with help from an experienced Kendall County divorce attorney. At The Law Office of Matthew M. Williams, P.C., we have assisted couples in separating personal and marital property and helped them write creative, mutually satisfactory divorce decrees that protect our clients’ interests in the present and the future. Call us now at 630-409-8184 to schedule your first meeting.

Source:

https://www.ilga.gov/legislation/ilcs/ilcs4.asp?DocName=075000050HPt%2E+V&ActID=2086&ChapterID=59&SeqStart=6200000&SeqEnd=8675000