How does divorce affect your business?

| Mar 26, 2021 | Divorce |

While navigating divorce for the first time, you have several questions. For instance, how could your marital split impact your business?

Business.com explores how marital splits play out in companies. Learn how to protect your business and the hard work you invested in building it.

Finances

As a state that recognizes equitable distribution, Florida divides marital property fairly and equitably, which does not always mean equal division. If your current spouse acted as an employee for your business, managed the company or contributed ideas, he or she may have a claim to a percentage of your operation.

Daily operations

You may find you cannot concentrate on running your business with thoughts of divorce swirling in your head. Your emotional and mental state may suffer, which may mean your company suffers, too. If your soon-to-be-ex-spouse has a stake or stock in your business, either before the divorce or through the divorce settlement, your former spouse may become a current business partner.

Selling stock or the business

Depending on the divorce settlement, you may have little choice but to sell a percentage of business stock to your workers or partners to meet your financial obligation. To limit your losses, consider implementing a buy-back agreement when future finances allow you to regain your full business stake.

Rather than selling stock, you may sell your business if your ex-partner becomes a business partner and the two of you do not work well together. If you choose this route, proceeds from the sale may become part of the divorce settlement.

Create a resiliency plan for yourself and your business. The proactive approach may serve you and your future well.