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Dividing Your Business during Divorce

Posted on in Property Division

California divorce attorney, California mediation lawyerYour marriage is coming to an end. No matter how long it lasted, this portion of your life changed you. You built a life together, no matter the condition of it. Now you are returning to the single life but a little older, maybe some children, and maybe some items. To get there, all the life that you created needs to be systematically divided. For business owners, there is the additional duty to divide up the company. Will you go into your new life with or without a business?

Business Acquisition

There is no “one size fits all” solution to any property division during divorce. What works for one family will not function for another. Each household situation is as unique and different as a thumbprint. However, there are guidelines and stipulations that a judge would follow, should your divorce require litigation. Most of the emphasis is placed on the acquisition of the asset itself. In the case of a business entity, it is more than just who purchased it and at what point in the marriage it was acquired. Consideration is given to:

  • Community property vs. separate property,
  • Source of financial backing,
  • Valuation date at the time the divorce is final,
  • Marriage date, and
  • Spousal contribution to finances, operation, etc.

Divide It Up

Whether the judge has total control over the outcome of your business or if you would like to make the decisions yourself is up to you. The judge will put little to no emotion into the decision-making process and will rely entirely on the aspects listed above. However, the alternative to divorce litigation is mediation. Mediation is a cost-saving option that enables you to determine an outcome that best suits your situation. Even in the most conventional solutions modifications may be applied. The three most frequently used solutions are:

  • Both parties continue to own the business jointly,
  • Sell the business and divide the profits, or
  • One spouse retains the business and gives up assets to “buy out” the other spouse.

If you are divorcing and have a business, it is important to consult with an attorney. There is a multitude of details to consider, including pension plans, securities, and property settlement notes. The division becomes confusing and stressful to those who are unfamiliar with the process. Attorney Benita Ventresca has been practicing family law in the Bay Area, assisting in situations just like yours, for over 35 years. If you are interested in discussing your options with a San Jose, CA divorce attorney, located in Los Gatos, contact the Law Offices of Benita Ventresca to set up your free initial consultation by calling 408-395-8822.

 

Sources:

http://www.courts.ca.gov/1254.htm

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