When you have a business, stocks, retirement accounts and other complex assets, dividing them upon divorce can be difficult. You may not know how much each asset will be worth, or want to give certain assets up.
In California, you’re expected to split your assets equally. So, to do that, you will need to give your property assigned values. Once you do that, you’ll be better able to divide the assets you share with your spouse.
What happens if you have a business during a divorce?
If you have a business, it’s smart to have the business assessed and assigned a value. For example, your business might bring in $60,000 in profits a year and have $150,000 of assets. You should also consider whether you’d like to continue running the business, want to sell it or want to give it to your spouse. Your decision dictates how the value is affected.
Here’s an example. If you want to sell your business, you may try to sell it for the base of $150,000 plus ten years of profits at $60,000 a year. For $750,000, you could sell the business and walk away nearly a millionaire. At that time, you could split that money with your spouse.
On the other hand, you could decide to keep the business and pay out only half of the profits each year to your spouse or to buy them out by paying ten years of their share of profits up front (as an example). This is something you can negotiate with one another with the help of an attorney, so that you can do what makes sense in your divorce scenario.
