Divorce and Your Small Business in Jackson, Mississippi

Your small business is likely your most valuable asset. But, if you are getting divorced, unlike other assets like family cars, jewelry, or even your family home, your small business can be tough to split during a divorce. After all, the value of your small business is so much more than the profits it delivers. Your business is likely the result of years of hard work and sacrifice. Therefore, it might mean so much more to you than its appraised value. After all, you may have devoted years of your life to growing your business. If you are getting divorced in Jackson, Mississippi, and if you have questions about what might happen to your small business, consider reaching out to Malouf & Malouf, PLLC, a divorce attorney in Jackson, Mississippi. How your divorce will impact your business will depend on many factors, including whether you owned your business before your marriage, whether you started your business after you got married, and whether you took steps to protect your business through a prenuptial agreement or through utilizing proper incorporation methods. Malouf & Malouf can review your situation, help you understand your options, and assist you with all aspects of your divorce. Possible Outcomes for Small Business Owners During Divorce in Jackson, Mississippi What are some of the ways that your divorce could impact your small business? It largely depends on how you’ve structured your business, whether you have a prenuptial agreement, and whether you started your business before or after you got married. Here are some of the scenarios that could play out:
  • If you owned and ran the business before you got married, and when you got married you signed a prenuptial agreement protecting your business interests, or if you structured your business in such a way that it clearly separated your salary from business assets, then you may be able to keep your business during your divorce. However, rarely are divorces involving small businesses so simple. If your partner played any role in increasing the value of your business and if you weren’t absolutely careful about distinguishing between business or marital assets, your former partner may have some claim upon your business.
  • If you owned the business before you got married, but don’t have a prenuptial agreement or didn’t take steps to structure your business when you got married, your former partner may have the right to make a claim upon some of your business assets. He or she may be entitled to some portion of the appreciation in value your business enjoyed during the marriage, because these might be considered marital assets. Any increase in value of assets during the marriage can be considered martial property.
  • If, after you got married, you and your partner went into business together or if you started your small business after you got married, you and your partner will likely need to consider how you’ll divide your business, whether you’ll run the business together after your divorce, or whether one of you will sell the business to the other, or sell the business entirely. This scenario can often lead to a complex divorce. Having a divorce attorney on your side like Malouf & Malouf, in Jackson, Mississippi can make a big difference in the outcome of your case and in your claim.
Navigating the divorce process can be tough enough when all you need to do is split property or a family home. When you involve a business in the mix, the challenges increase. Malouf & Malouf are Jackson, Mississippi divorce attorneys who may be able to help you with your divorce if you own a shared small business with your spouse. Business Divorce and Marital Divorce If you and your former partner need to split a business, several things must be considered. For one, the business might need to be appraised. You may also need to determine what percentage of the business assets each of you will be entitled to receive. If you both started the business after getting married, the split might be 50-50. But if one party started the business prior to the marriage and the business only appreciated in value during the marriage, you may need to determine how much value the business increased during the marriage because this increase in value may be considered marital assets. You may have several options when it comes to divorce and divorcing your business. In some scenarios, divorced couples may choose to continue running the business together as business partners. In other scenarios, both parties determine each party’s share in the business and split the profits accordingly. In other instances, one party in the divorce, “buys out” the other party’s share, through marital assets or shared cash, or other property. Divorce, when you own a business can be complicated. Many small business owners are personally invested in their companies. Separating business decisions from emotional decisions can be stressful and challenging. This is where having a divorce lawyer like Malouf & Malouf, in Jackson, Mississippi can help you.
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