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You can protect a business during a divorce

When you have a family business but you're going through a divorce, there are some important decisions that have to be made. Will the business stay open? Will one of you sell his or her share in the company? Will you sell the company to a third party?

The first thing you should do is to determine how much your business is worth. Unless you have a prenuptial agreement, you will find that your state is an equitable distribution state and that the business itself can be equitably distributed between you and your soon-to-be ex-spouse. That means that you need to know how much it's worth for negotiations.

If you decide to sell the company, knowing its value can help you find an appropriate buyer. It's a good idea to work together to find a valuation company you both can agree on instead of using two, because using two can lead to having multiple valuations that vary, making it harder to know the true value you should settle on.

One thing you might not want to do is to continue having a shared interest in the company. While you both put effort in, having two people who are divorcing running a company can become murky waters. If you do both want to continue to run the business, you can, but it's a better option to have one person buy out the other. Then, there's only one person running the company and focusing his or her efforts on it.

These are just a few things to think about before or during your divorce; your business can survive with the right choices.

Source: Crain's, "Family business and divorce: a six-step survival guide," Meg McSherry Breslin, accessed Nov. 23, 2016

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Bononi & Company PC
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