Division of Business Assets
DIVORCE LAWYER NEGOTIATES DIVISION OF BUSINESS ASSETS
Resolving business-division disputes in Westchester County
Determining how to divide a business in a divorce can be a complicated task. Navigating the legal intricacies of business asset division requires a divorce lawyer well-versed in family law and business matters. Through negotiation, mediation, and litigation, Lauren B. Abramson, Esq. has helped clients resolve disputes over the division of business properties since 1987.
MUST YOUR BUSINESS BE DIVIDED IN A DIVORCE?
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The first question is if the business is marital property. If you and your spouse started and operated the company together, it likely is marital property subject to New York’s equitable distribution laws.
If, however, you owned the business before the marriage, only the appreciation in the value of the business during the marriage is susceptible to being treated as marital property. If your spouse made no contribution — financially or otherwise — to the business, you may be in a position to argue that he or she is not entitled to even a share of the appreciation. The attorney and staff at the law offices of Lauren B. Abramson can help you sort out these issues.
HOW DO I FIGURE OUT HOW MUCH THE BUSINESS IS WORTH?
When dividing the assets in a high-net-worth divorce, it is critical to obtain a reliable analysis of the value of your business at the time of the marriage and at the time of the divorce. At the law offices of Lauren B. Abramson, we work with experienced business valuation experts to assemble unassailable evidence of the value of your business.
PREPARING FOR YOUR FIRST MEETING WITH A DIVORCE LAWYER
Preparing for your initial consultation with a divorce lawyer can help make the process more efficient and productive. This is especially true when a business is involved, as the division of business assets requires careful consideration and detailed documentation. Below is a list of steps to take and documents to gather to ensure you are ready for your first meeting.
- ● Gather All Business Formation Documents: Collect articles of incorporation, partnership agreements, operating agreements, and any shareholder agreements. These documents are essential for establishing the legal structure and ownership of the business.
- ● Compile Comprehensive Financial Statements: Bring several years' worth of business financial records, including profit and loss statements, balance sheets, and cash flow statements. These will provide a clear picture of the business's financial health.
- ● Organize Business Tax Returns: Collect at least three to five years of federal and state business tax returns. Tax returns are crucial for understanding the business's reported income and value over time.
- ● Document Your and Your Spouse’s Contributions: Prepare a detailed account of both your and your spouse’s contributions to the business. This includes financial investments as well as non-financial contributions like time, labor, and expertise.
- ● List All Business Assets and Liabilities: Create a comprehensive list of all assets owned by the business, such as real estate, equipment, and inventory, as well as all debts, including loans and outstanding payments.
- ● Find Any Prior Valuations: If the business has been professionally valued in the past for any reason (such as for obtaining a loan or bringing on a new partner), bring a copy of that valuation report.
- ● Prepare a List of Questions: Before your meeting, write down all your questions and concerns regarding the division of the business. This ensures that we address all your key issues during the consultation.
Taking the time to organize these materials will allow us to gain a thorough understanding of your situation and provide you with the most effective legal advice.
WHAT IF WE BOTH OWN THE BUSINESS?
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If both spouses are equal owners of the business, there may be no need to divide the company — if you are willing and able to continue operating the business together despite the breakdown of your marriage. There are many factors to consider when faced with this situation, including:
If there are third-party owners
How much of the business each party owns
The extent to which the spouses are involved in the day-to-day operation of the business
If the parties have sufficient liquid assets to allow one to buy out the other
If either spouse is integral to the continuation of the business
HOW IS A BUSINESS ASSET DIVIDED IN A DIVORCE?
If the business is in fact considered marital property, the division of the business is subject to the same laws as any other marital property. The business may be sold and the net proceeds distributed equitably; one spouse may "buy-out" the other spouse's interest in the business or one spouse may transfer his/her interest in the business to the other in exchange for other marital assets. No matter how the business asset is to be divided, it is important to know the value of the business.
Lauren B. Abramson understands a family’s long-term hopes for a business, including the possibility of passing the business on to the next generation. We work hard to help you achieve your goals.
CONTACT OUR WESTCHESTER COUNTY MATRIMONIAL LAW FIRM TODAY
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Lauren B. Abramson, Esq. understands that you have an emotional investment as well as a financial investment in your business. If you are a business owner whose marriage is dissolving, contact us today to begin protecting your business assets. Our office, which is across from Saxon Woods Park, is open from 9 a.m. to 5 p.m. Monday through Friday. Call us at (914) 908-5877 or contact us online today to schedule a consultation. We serve clients throughout Westchester and Putnam counties, including White Plains, Harrison, New Rochelle, Bedford, Armonk, Bronxville, Larchmont, Mamaroneck, Somers, Croton-on-Hudson, Peekskill, Rye, and Carmel.