Illinois is an “equitable division” state, which means that during a divorce, all marital property should be equitably divided between the parties. Some assets are easier to split, like shared savings accounts and vehicles. But for some, it gets even harder to negotiate who keeps what and who leaves it. This includes dividing a family home and dividing a business and all its assets.
It doesn’t matter who spent most of their time working to build the business; if it was started after marriage, it automatically becomes marital property. In circumstances where one spouse started the business before getting married, the business can also become marital property if joint funds were used in the company or if the non-owning partner made any contributions to the business, be it financial or non-financial.
Before a couple is divorced, they should know the value of the assets they own and that are subject to division. This allows the couple to know the exact property value and how much it should be sold for or what other property will have a similar or equivalent value. There are three main methods used to evaluate businesses during a divorce.
If the spouses agree, they may determine the kind of appraisal to use to evaluate the company. If the divorce case is contested, each party can use a different valuation method and try to convince the court through their testimony and maybe the use of expert witnesses. This is one more reason why it is recommended to seek help from a skilled Illinois divorce attorney.
In an Illinois divorce, you have several options in the division of the business.
However, regardless of the choice you make, you will be required to have your business properly evaluated. The value of your business will not only influence the division of debts and assets but also spousal support, child support, and other divorce issues.
If you founded the company during your marriage, your spouse is entitled to up to half of the company’s value of the company because it is certainly considered marital property. But there are exceptions, especially if you are particularly savvy about protecting your company from being divided in the divorce. You could:
The prospect of dividing a business or company you have worked long and hard for can be appalling, but an experienced Libertyville family law lawyer at Johnston Tomei Lenczycki & Goldberg LLC can help you work towards a favorable result. We cater to our clients’ diverse legal needs, including business litigation, family law, and probate law. Contact us to schedule a free consultation today.
Phone Number: (847) 549-0600
Fax Number: (847) 589-2263
350 N. Milwaukee Ave., Ste. 202
Libertyville, IL 60048
223 N. IL. Rt. 21, Ste. 14
Gurnee, Illinois 60031
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Wheaton, IL 60187