Mixing business and pleasure can be difficult, even in good times. When things go bad, however, it is much worse. Unfortunately, despite everyone's familiarity with the age-old idiom, the mixing of business and pleasure happens all the time. In fact, Minnesota readers may find it interesting to learn, according to the most recent Census data on divorce, there are nearly 3.7 million married couples who own businesses together. That is a major risk in an otherwise unpredictable world.
While divorce is never an easy thing, when married couples also happen to be business partners, it can be much more difficult than in a traditional divorce. While the hope is that married couples that have a family owned business would have a prenuptial agreements or partnership agreement that addresses what would take place if a divorce were to occur, all too often this is not the case. The following is some advice for couples with family owned businesses that are currently going through divorce.
Whenever a divorcing couple is dealing with a business, it is important for the couple to discuss the goal of both parties. In some cases, one spouse may want out of the business and consider selling their share in the operation to the other spouse. In other cases, the couple may decide their work relationship is possible to save and that with the proper parameters and rules the couple can continue to be business partners. If the couple cannot agree on a compromise, selling the business may be the only option.
If selling a family business does become a necessity, it is important to speak with an experienced attorney about obtaining an objective and reliable assessment. Understanding the local law and having an objective and independent appraiser are key to maximizing results. In addition, a skilled family law attorney will also be to help parties maximize tax benefits that can result when during complex asset division. This can have a significant impact on reducing the financial burden associated with property division.
Source: CNN Money, "Double trouble: When spouses who share a business call it quits," Brandon Southward, April 9, 2014
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