Experienced Divorce Counsel For North Carolina Business Owners
Building a business can take years of dedication and hard work. You may worry about how your divorce could affect its growth and profitability. Gantt Family Law can help business owners like you feel more certain about your business’s future and assist you in protecting and distributing business assets.
What Equitable Distribution Laws Can Mean For Business Owners
North Carolina is an equitable distribution state. That means if you and your spouse cannot agree on dividing certain assets, a judge can decide based on what they believe is reasonable and fair. If you began your business before your marriage, courts might consider it separate property that isn’t subject to division. However, if you started your business or it accumulated significant value during your marriage, the judge may consider it marital property, meaning it could be subject to division.
As most judges are not business owners themselves, their decisions may not account for the legitimate needs and concerns of entrepreneurs like yourself – that’s why having the right representation on your side is important. Our Wake County divorce attorneys have strong knowledge of North Carolina’s property division laws and everything involved with running a successful enterprise. They can assist you in guarding your business’s current and future value so you can continue running it after divorce.
How Can I Protect My Business Amid Divorce?
If you do not have a prenuptial or postnuptial agreement, there are ways you can protect your business assets. Here are a few to consider:
- Updating your business bylaws: You may decide to establish sole ownership of your business should you divorce.
- Establish how much your spouse will get before the divorce: An appraisal can help you understand the value of your business before divorce and help you create a division formula that accounts for your specific needs and situation.
- Sell your business: If your spouse has no stake in the business, you can legally sell it if you choose. While the money you accumulate from the sale may be subject to division, you may find it easier to split cash instead of the diverse and complicated assets that can come with a business.
We can help you understand your circumstances and find a solution that works for you. Set up an initial consultation by visiting our contact page today.
How Do I Divide Business Assets In A Divorce?
You have a few different options to divide business assets when you get divorced. The first – and, in some ways, the easiest – is to sell the business. If you and your spouse both have a claim or are joint business owners, you may be able to sell it to a third party. You can then divide the money that you earn from the sale.
Even if you do not co-own the business, you may still be entitled to a portion of its increased value during the marriage. For example, if the business was valued at $100,000 when you got married and is now worth $2 million, you could be eligible for a percentage of that increase.
Another option is to trade other marital assets to make up the difference. For instance, maybe you were entitled to a portion of your spouse’s business, but they want to retain full ownership after the divorce. They may give up their share of the family home or a retirement plan in exchange.
Finally, some couples use a partnership agreement and become business partners, working together even after the divorce. For this option, make sure you get the proper agreements and documents in place to establish roles and ownership percentages since you will no longer be married.
How Is A Business Valued In Divorce?
There are different tactics to use in determining the value of a business. An asset-based valuation just looks at the liabilities that the business holds and subtracts that debt from its assets to find a final value. Assets could include real estate, inventory, machines, etc.
Another option may be to look at the market value of the company. If similar companies have recently been sold, that can give you an indicator of what the fair market value looks like.
Finally, you could use an income-based valuation. You essentially look at the company’s annual earnings – and perhaps even project into the future – to decide what it is worth today. This helps to establish the true value of a growing business.
Work With Raleigh Divorce Lawyers Who Understand Business
We know how important your business is, and we can help you advocate for your needs throughout your divorce. With over twenty years of experience in family law and backgrounds in business and tax law our attorneys have the legal and business knowledge to guide you through your divorce. Don’t wait, call 919-518-9540 to schedule a consultation today – we look forward to speaking with you.
Read more: How Will Your Business Be Valued In A North Carolina Divorce?
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