don't give up your rights without a fight.
choose marcus wilkerson

How to divide a family business in a divorce

On Behalf of | Oct 1, 2021 | Family Law |

Married couples in Texas acquire various assets throughout their marriages. They may have homes, vehicles, checking and savings accounts, retirement accounts and other assets. They also earn income from their jobs during the marriage. Other people may be self-employed or be the owners of their own business. When couples own businesses, it creates a unique situation because that business is their source of income, but it is also an asset.

Since businesses are assets and have value separate from the income they generate for the owners, they need to be divided like other assets in a divorce. However, it is not as simple as dividing a bank account. The couple does have options, but these options generally start with having the business appraised to determine its value.

Options for dividing businesses

One spouse could choose to keep the business. If this happens, they will be required to pay the other spouse their portion of the value of the business. This could be difficult though, especially if the business has significant value. The spouse may not have the cash on hand to pay off the other spouse. So, they may need to set up a payment plan or that spouse may receive a portion of the income from the business until they are paid off.

Another option is that the couple could keep the business and continue to run it together and share in the profits as business partners, if that is possible on a personal level.

The last option is that the couple could decide to sell the business and split the proceeds of the sale. This can take time though as selling a business is different than selling a house or other assets and it could prolong the divorce potentially.

They are many business owners in Texas. Running the business can be complicated enough, however, if they divorce, it could become even more complicated for them. The division process can be time consuming and take time to resolve. Experienced attorneys understand the options people have for selling their business and may be a useful resource.