You and your spouse may have plenty of assets to divide up during your divorce in Texas, from the home to the investment accounts to your vehicles. However, if you’re both working together as the joint-owners of a family business, things can get even more complicated. You probably didn’t want to bring up divorce when deciding to launch the company together, but now you have to do something with it. You have a few options:
1. Keep it. If your divorce is on good terms, you and your spouse don’t have to split it up or sell it at all. While your marriage ends, you can just stay in your positions as owners and run the company as business partners. Clearly, this doesn’t work for everyone, but it is an option that should be considered.
2. Have one spouse buy out the other. If you value the business at $200,000 and you both own half, your spouse may be happy to take $100,000 in cash to make you the full owner. You could also agree to split up your other marital assets—like those listed above—to take over control of the company. Perhaps you don’t care about keeping the family home, for example, so you’d part with your share to keep the company.
3. Sell it. If nothing else works, you and your spouse could consider selling the company and dividing whatever you make. This isn’t ideal if you don’t want to lose the company and be out of work entirely, but you could invest what you make in a new business.
No matter what you choose, it can be quite complicated, so take the time to look into all of the legal steps you need to take.
Source: Forbes, “How To Handle Divorce In A Family Business,” Larry Light, March 07, 2016