Who Gets the Business in an Illinois Divorce?
Posted on January 25,2021 in High Asset Divorce
Among the many issues that need to be decided during a divorce is how to divide the couple’s marital assets and debts in an equitable way between the two spouses. This usually involves the division of real estate property, furniture, vehicles, bank accounts, retirement accounts, stocks, and other items of value. However, when one spouse owns a business or the spouses own a business together, that business is also likely to be an asset for which ownership must be determined during a divorce.
Determining the Value of a Business
The first thing to understand is that both the rights to the business and the value of the business must be considered to determine whether it is a marital asset and how it will be handled during the property division process. Under Illinois law, a marital asset is an asset that is acquired by either spouse during the marriage, with limited exceptions. This generally includes a business that was started or acquired during the marriage.
There are different ways to value a business, including approaches based on market value, assets, and expected future earnings. Each of these methods may be used for different purposes, and you and your spouse may have trouble agreeing on the value of the business, so it is often a good idea to work with a professional business valuator and seek multiple valuations.
Accounting for a Business’s Value in Your Divorce
Once you and your spouse have agreed on an acceptable amount for the value of your business, you can determine how the business’s value will be divided. If you wish to keep the entire business, for example, you will probably need to offer your spouse a larger share of the remaining marital property. However, if your marital estate is not large enough to account for the value of the business in this way, you could give your spouse a continuing share of the business, at least until you can afford to buy your spouse out.
If you cannot come up with a satisfactory arrangement that allows you to keep the business, you may need to sell it and split the proceeds of the sale. This option might not be ideal for you, but it may prove to be necessary in order to complete your divorce.
Contact a DuPage County Asset Division Lawyer
If you own a business and are considering a divorce, it is important to work with an experienced Wheaton property division lawyer from Andrew Cores Family Law Group. We will provide the guidance you need to ensure that you can move comfortably into the next chapter of your life. Call 630-871-1002 for a free consultation and review of your case today.
Sources:
https://www.ilga.gov/legislation/ilcs/ilcs4.asp?DocName=075000050HPt%2E+V&ActID=2086&ChapterID=59&SeqStart=6100000&SeqEnd=8350000
https://www.thebalance.com/business-valuation-methods-2948478
