You and your spouse may co-own a business in Pennsylvania together that has done well over the years, providing a lucrative income that supports you both. Still, business success does not always mean the rest of your life will work out as planned, and you may find that you and your spouse are getting a divorce. If so, you will have to decide how to divide the business you share together.
Three Options for Your Business Post-Divorce
Assuming you and your spouse are the only owners of the business, a popular option is for one of you to continue owning the business and for the other to bow out. If you are the spouse keeping the business, you will generally buy out your ex’s interest in the business so you will continue on as the sole owner. If a buyout is not financially possible, you may be able to agree to a settlement note that will allow you to make smaller, regular payments to buy out your ex’s share in the business.
If you and your spouse are on decent terms with one another post-divorce and if you work together well as business partners, you may be able to continue owning the business together. This has a financial advantage, as neither spouse needs to buy out the other. If the business is successful, this also has the advantage of letting the business continue to run as usual post-divorce.
Sometimes a business and marriage are so entwined that if the marriage fails, neither spouse is interested in or can afford to continue owning the business. If so, it may be time to sell the business to an outside party and divide the profits from the sale. Sometimes we just need a reboot; a fresh step forward into a new life.
Know Your Options for The Family Business
Sometimes things just do not work out as planned. You may have dreamed of working side-by-side with your spouse until retirement. But when divorce is on the horizon, these plans may need to change. Knowing your options for the family business in a divorce is a good first step in moving forward with your life.