Divorce can be challenging and stressful for both parties. Deciding how business divorce assets will be divided can add more stress.
Business Divorce Assets | Finding Hidden Money in a Business
Today’s access to electronic records – and records in general – make it very difficult to hide money. It can be done, but it’s difficult. For example, we sometimes find money hidden in business accounts where the business’ cash accounts continue to accrue money that is not paid to the business owner. These retained accounts sometimes grow to unreasonable levels – and then the spouse who owns the business says, “Let’s divide the business assets. I’ll give you 20%.” This means the non-titled spouse receives 20% of that cash – or whatever percentage is named – instead of the 50% they might have received if those funds had been paid out and properly placed into another marital account, such as a checking or savings account.
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Business Divorce Assets | Getting a Share of Your Spouse’s Business
If either spouse owns a business, the proper way to determine the value of that business is to retain an expert who can calculate its value. Once the business is valued, the parties will negotiate – or the court will order – the non-titled spouse’s share. That share can range from 20% to 50%, and many factors impact a court’s decision – or a party’s negotiating position. Regardless of the amount, a specific mandate will be entered setting forth how the spouse who is not titled to the business is to be paid. If the payment is to be made over time, it may include an interest component.
Business Divorce Assets | Handling a Mutually Shared Business
In most instances, when we deal with a business in which both parties work, it’s a business one of the parties started, or one party has more of a vested interest in maintaining the business. Depending upon the type of work done, the more-interested party may be more of a principal in the business. In that case, it will be natural for that party to retain the business. In some cases, however, the parties may have started the business together, and that presents a significant challenge. In some cases, the parties are able to continue working together, and can remain partners. It’s not always advisable, but it can work because success in such a partnership depends upon the parties themselves, and the level of their acrimony or cooperation. After a high-conflict divorce, however, it will be impossible for both parties to continue running that business.
If you need legal representation for your divorce, please call our Saratoga divorce attorney today.
