If you’re getting divorced, thinking of getting divorced, or in the middle of a divorce, here’s a question: Did you ever think it would be so financially complicated? Untangling the emotion aspects of divorce was always going to be difficult (the kids, their custody, the legal end of your marriage vows), but heading into divorce few people contemplate how many economic issues there are to resolve.
These financial issues can be even more difficult if you are the owner or co-owner of a business. Since the state of New Jersey (with very few exceptions) views a business if, started or purchased during a marriage, as a joint marital asset and thus subject to equitable distribution; the economic factors of valuing and dividing a business must be considered in a divorce.
The very first thing you want to do is to immediately consult with a dedicated family law attorney from the O’Cathain Law Group Family Law Department. Take a moment to call (848) 375 – 1097 or fill out the form on our website right now. Our experienced family law lawyers are well versed in divorces that involve the equitable distribution of a business, and work with your financial and legal team (which will include a forensic accountant and a dedicated family law paralegal) to protect you and help you Move Forward.
If you prioritize maintaining control of your business, talk to your family law lawyer about a buyout or offsetting the value of one asset against another. You may be able to offset the equitable distribution of the business by, say, offering your spouse the deed to the marital home or the retirement savings.
Financially speaking, getting divorced is all about setting priorities, and offsetting or buying out your spouse may be a tool that you and your team find useful.
Oftentimes in divorce a buyout comes into play with the marital home. The first step is you and your legal team, and the opposing party, working with forensic business accountants to determine the valuation of your business. If the parties cannot agree on the value of the business, the court may intervene and even use their own forensic business accountant.
Once the value is determined, a buyout may be offered, depending upon on who wants control of the business. A buyout may be financed through a bank loan, taking on debt or using pre-marital assets— inherited money, assets acquired prior to the marriage, stock options not subject to equitable distribution. If you can put together the means to do so, a buyout may be an effective and timely way to protect your business.
The financial aspect of a divorce is just one part of the process, yet an important part. Considering the use of offsets and buyouts as part of the larger picture, both financially and emotionally, is best discussed with your legal team. The type of business divorce we’re reviewing here is complicated. Reach out to O’Cathain Law Group Family Law Department today to safeguard your future and Move Forward.