Going through a divorce can be a challenging time for anyone, but it can be incredibly complicated when a business is involved. When a couple decides to dissolve their marriage in Illinois, it is essential to understand the laws around business valuation and division. If you have started a business from the ground up and are concerned you might lose it, contact our attorneys for guidance.
This article will discuss the different aspects of business evaluation in Illinois divorce cases and answer some common questions about the process.
In Illinois, the court will divide property equitably between the parties in a divorce. The first step in determining how a business will be divided is whether it is marital or non-marital property. Marital property is any property acquired during the marriage, while non-marital property is any property acquired before the marriage, through inheritance, or as a gift.
If the business was started before the marriage or received as a gift or estate, it might be considered non-marital property and not subject to division.
If a business is determined to be marital property, it will be subject to division in the divorce settlement. The court will consider various factors when choosing how the business will be divided, including the contribution of each spouse to the company, the value of the business, and the financial needs of each spouse after the divorce. One option for dividing a company is for one spouse to buy out the other’s interest.
Valuing a business is critical in determining how it will be divided in a divorce settlement. The value of a business can be defined in various ways, including income, asset-based, and market approaches. The income approach considers the business’s earnings, while the asset-based approach looks at the value of the assets owned by the business. The market approach looks at the importance of similar companies in the market. It is essential to have an experienced valuation expert to determine the business’s value accurately.
If you are a business owner going through a divorce, there are several steps you can take to protect your business. One option is to have a prenuptial or postnuptial agreement that addresses the business’s division in case of divorce. Both or either agreement can help prove that the company is a non-marital property and protect it from division. Another option is to keep accurate financial records and separate personal and business finances.
Business valuation in Illinois divorce cases can be a complex and challenging process. Having an experienced divorce attorney who understands the laws and can help protect your business during the divorce process is crucial.
The attorneys at SLG Family Law have the knowledge and experience to handle complex divorce cases involving companies. Contact us today for a consultation and to learn more about how we can help you protect your business during a divorce.
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