Are you a “copreneur”? This word is used to describe a couple
who owns a business together, and there are thousands of them across the
country. Let’s face it, America is the land of opportunity, and
for those that dare to take a risk, opening a business can be very rewarding.
There is nothing like being your own boss, and calling the shots every
day. But, if you decide to do this with your spouse, it is wise to make
sure the agreement is clear and in writing. While no one gets married
with the thought of getting divorced, it does happen. And, when it happens
to a family that not only lives together but works together, the property
distribution issues can become quite complex.
When a couple gets divorced, the Court will make an equitable
distribution of their property. What this means is that the Court decides what is fair when dividing
the assets and deciding who will pay which debts. This does not necessarily
result in an equal split of things, but does result in a split that the
Court believes to be fair. If a business is involved, the first step is
to determine what value to place on the company. Once that is done, the
Court can then make orders with regard to the total value of all assets,
and it may be that one spouse ends up entirely with the family store while
the other gets other items of value.
To determine what a business is worth, you have to look at its books. And
while profitability is one important factor in calculating value, there
are other things that are not as easily seen that play a role. It is also
critical to look at the value of the work and time put into the company
by each party. When a couple decides to hang a shingle and open a store,
they give up other employment opportunities. What you gave up in order
to build something that is worth having is valuable. Other factors to
consider when determining business value are the reputation of the company,
or its goodwill. What the public thinks of your business is an asset of
your business, and it should be included in the final figure. If you own
a company with your spouse and are considering divorce, call us before
you make any important decisions about your business. We can help protect
your rights by making sure the business is appropriately valued, and that
you receive your share of the value of all of the marital assets.