If the life you built with your spouse involves a business, asset division during your divorce becomes a much more challenging feat. This rings especially true in Kentucky, where the law divides marital assets fairly but not equally.
Under this principle, your spouse may claim a portion of your business’s value, even if they did not directly participate in its operation. As a business owner, you might wonder: How can you protect your hard-earned business interests during your divorce? Here are some steps you might consider when navigating this complex situation.
Identifying and documenting business assets
It is important to remember that company assets extend far beyond financial statements. You may have intellectual property, equipment, inventory and other tangible assets that need to be identified and documented. Make sure to have a thorough understanding of these assets, as this will help you negotiate a fair division.
Hiring a business appraiser
Determining your company’s true value is a critical step in the property division process. A business appraiser can do this for you by looking into the company’s revenue, assets, debts and future earning potential. This will allow you and your spouse to negotiate a fair split of your marital properties.
Negotiating a buyout or co-owner agreement
Once you have established the value of your business, then you can decide how to divide it. Typically, one spouse buys out the other’s share. If you are in this position, you might need to consider options like taking out a loan or liquidating other assets to finance the buyout.
Another option to consider is pursuing a co-owner agreement with your spouse. While this path may present challenges, it can offer a way to preserve the business you both value.
Protecting your business and your future
As you navigate asset division, it is crucial to consider not just the immediate division of assets but also the long-term implications for your business and personal life. Remember, the strategies you take now can set the stage for your business to not just survive but thrive in the next chapter of your life.