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What does divorce mean for your joint business?

| Apr 1, 2020 | Firm News |

Entrepreneurial couples might spend years developing a thriving business together, one that even provides the bulk of their household income. However, when a couple who own a joint business decide to divorce, a few significant problems can arise.

Some divorcing couples may not know how to handle the split, including who gets ownership, how to navigate finances, and what business roles both partner will play in the future.

Take care of yourself so you can make clearer decisions

It’s important to keep business and personal life as separate as possible. That might mean taking time to care for your own needs before turning your attention back to the business and its related decision making.

You might seek therapy to process emotions, which can help clarify practical decisions, or take a trip to clear your head and have personal time. Either way, getting out of the bubble in the beginning can let you step back and see things through a more rational lens.

Embrace the change and work with what you have

Be open and flexible to the change that is on the way. Some couples manage to successfully run a joint business after they divorce. In other situations, one spouse decides to step away and give full ownership to the other, or to another business partner. Some dynamics may even call for completely selling the business and dividing the assets.

Remember to consider business taxes, rent, inventory, and other business items when making a division. If one spouse invested significantly more into the business, the other may still be entitled to half of certain assets that were established once the business became marital.

Keep looking forward

The key to managing a joint business after divorce is to stay calm, remain amicable, and look toward the future. You and your spouse may be ending your marriage, but there is still an opportunity to continue running a prosperous business for years to come.