Sometimes Wisconsin couples go into business together. However, if the marriage should fall apart, in many instances the business partnership of the spouses goes with it. So what should you do if you and your spouse possess ownership in the same company? If you do not feel you and your spouse can run the business after the divorce, you should try to work out an amicable way to settle the fate of your business.
If you can, try to plan what would happen to your business before you get divorced or even before you get married. Since many couples start a business during the course of their marriage, a prenuptial agreement will not be possible. However, a report on CBSNews.com points out that a couple can still work out an arrangement, such as a shareholder agreement, that dictates what happens to the company if the couple should split up. Such an agreement can include an option for one of the spouses to sell off their ownership to the other at a predetermined price.
In the event a divorce does occur without a prearranged business agreement, you can still try to buy out your spouse’s interest in the company. You will still run the business while your spouse walks away from it. A buyout can be arranged in exchange for other marital assets that the other spouse may want and you do not consider valuable enough to keep. If one spouse cannot pay the other in one lump sum, a payment schedule can be arranged.
However, if keeping the business intact is no longer possible, you might consider selling the business outright and splitting the profits between you and your spouse. Inc.com explains that you would have to valuate the business to come up with a proper sale price. Since selling your business will involve taxes, you should hire a tax professional that understands local and federal tax law.
In any case, whether you are prepping a sales price or a buyout price for your spouse, you need a professional to help you so that your spouse will have confidence that the buyout amount is fair. Otherwise, your former spouse might contest the amount and drag out the process, perhaps bringing in another professional to present competing figures. Ultimately, promoting as much cooperation as possible between you and your spouse is crucial to resolving your business ownership matters.
