Utah law dictates that marital assets are divided equitably upon divorce. Practically speaking, this means that if either party to a divorce has an interest in a business, part of that interest may be awarded to the other party in the divorce decree. As you can imagine, the difficulty lies in determining who keeps the business and how much each party’s interest in the business is worth.
Although every situation is unique, the following are some questions to consider in determining how to divide a business’ value upon divorce:
- Should the business be considered solely an asset, or both an asset to divide AND income for alimony and child support purposes?
- Who works at the business?
- Who will remain working at the business?
- Does the person paying alimony or child support need to maintain ownership in the business to maintain their payment obligations?
- Do other people have ownership in the business?
- How does the business report income?
- How do the employees or owners receive their income?
- Was the business started during the marriage?
- Is the business jointly owned by the parties to the divorce?
- Is a business valuator going to be helpful or more costly than it is worth?
- If parties decide to use a business valuator, what type of valuation should be conducted and how will it be paid for?
- How will a spouse who is taking on sole ownership of a business that has marital equity “buy out” the other spouse?
Although divorce with a business can get complicated, at Pearson Butler, we are uniquely qualified to help parties navigate the complexities of dividing interests in businesses. We have both family law attorneys who are highly capable with navigating complicated business matters, as well as business law attorneys who can navigate changes to a business after divorce.
At Pearson Butler, when it takes a team, we understand.
Call (800) 265-2314 for a free consultation with a Utah attorney. We can also be reached online here.