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What to do with a family business in a divorce

Couples in Maryland who are business owners and who get a divorce might also need to decide what they will do with the business. Since the assets of both people may be largely tied up in the business, neither may be able to buy the other out. While a prenup or a buy-sell agreement might address the issue effectively, many couples do not want to discuss divorce when they are wedding planning. Therefore, they may be left negotiating the fate of the business as part of the divorce.

If the two are able to work together, they might consider continuing to co-own the business. A shareholder agreement can create parameters that allow one to buy the other out. If one spouse does buy out the other, assessing the value of the business is necessary, and this can be complex.

Knowing the value of the business will also be necessary if the couple decides to sell it. The advantage is that they will be able to disengage from one another financially. However, if the business is one that is difficult to sell, this may be a long process.

A high-asset divorce may present other complications in addition to dividing a business. There may be complex investments, and people might want to try to negotiate property division rather than going straight to court. The advantage is that this approach aims for a cooperative solution rather than an adversarial approach. However, the disadvantage is that during the stress of a divorce, people who are guided by their emotions may tend to make poor financial decisions. People might want to discuss property division with an attorney to find out what they might realistically ask for.

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