Owners of small businesses often commit a lot of their time and resources to running their companies. Their entire family may reap the benefits of those efforts in the form of an improved standard of living compared with other households. A successful small business or professional practice might represent the most valuable shared asset in a marital estate.
Unfortunately for many business owners, the demands of running a company may strain their closest relationships. Divorce could eventually force an entrepreneur to change not just their family circumstances but also how they operate their company. Many Ohio business owners contemplating divorce or recently served with paperwork will want to address the three concerns below as soon as possible.
What happens to ownership of the business
If someone started a business during their marriage, their spouse could very well be a co-owner on all of the company paperwork. Even if one spouse isn’t named on business documents, they probably have some degree of ownership interest based on the investment of marital resources in the business. Some couples will agree to joint ownership of the business moving forward, but most couples prioritize separating their interest in the business during divorce. One spouse might keep the company, or the couple might decide to sell the business as a way of making property division as fair as possible.
What happens with employment arrangements
In scenarios where both spouses work at the company, a divorce can lead to fear about someone’s future income. Spouses often are not able to continue working together at the business following marital dissolution, so it may be necessary to negotiate the exit of one spouse from the company. In scenarios where spouses agree to continue working together or owning the business together, they will generally need to have very clear plans for the management of the company and the division of their responsibilities to minimize conflict.
What the company is worth
Whether one spouse intends to buy out the other or the plan is to sell the business to a third party, having a reasonable understanding of what the business is actually worth on the open market is very important. The business valuation can influence everything from the division of other property to any alimony or spousal support ordered by the courts.
Ohio business owners who have specific goals in mind regarding their business often seek to negotiate with their spouse or attend mediation so that they retain control over those decisions instead of relying on a judge to rule on how their company must be addressed along with their other assets. Identifying the resources and issues most likely to complicate an Ohio divorce may help those preparing for marital dissolution to better protect their most valuable assets and set themselves up for a financially stable future.
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