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Divorce challenges spouses who own businesses together

On Behalf of | Dec 26, 2018 | Divorce |

Many couples who end their marriages in Connecticut encounter difficulties when dividing marital property. Spouses who own a business together or with other partners, however, have even greater challenges to overcome when preparing for divorce. They need to determine the value of the enterprise and make decisions about selling the business or buying out a departing partner.

Financial advisers emphasize that a divorcing owner needs to obtain an accurate valuation of their enterprise as determined by an independent professional, like a forensic accountant or business appraiser. This person will scrutinize financial records and calculate the current value of business equipment, real estate and intangible assets like a recognizable company name. The appraiser will also watch out for irregularities that might indicate that one spouse is trying to alter the value of the business. Hidden liabilities, like informal loans, might also be detected by a forensic accountant.

Once determined, the value of the business will guide negotiations that resolve the divorce settlement. One partner might choose to buy out the other partner either in cash or with a promissory note that should be backed by collateral. Decisions made at this time could have tax consequences; therefore, an accountant could provide valuable guidance.

The complexities of dividing a business and marital assets might motivate a person to acquire legal representation. An attorney could provide information about family law that guides property division during a divorce. Legal advice could inform a person about options for solving problems and lead to compromises that protect long-term interests. An attorney could write the necessary court filings to complete a divorce. If disputes cannot be resolved privately, legal counsel could litigate the divorce and organize evidence that might encourage a judge to make a fair decision.