What if my spouse or I own a business in Tallahassee (or elsewhere)?
According to Florida law, property is divided through “equitable distribution.” In general, this means property should be divided “fairly” between spouses. This division is not necessarily equal and changes with each case.
In terms of business ownership, things can get a little sticky. If you or your spouse started the business during your marriage, it can be considered a marital asset. This means that it can be divided between spouses based on the Court’s judgment.
Often, however, the Judge will award the business to the spouse who started and operates the business. In this case, the Judge would give the other spouse (who is not receiving the business) other property or assets to make the trade fair. Thus, if you own a business and can keep it during the divorce, your spouse will receive some other assets as compensation. The same is true vice versa. Many factors go into this decision, including length of marriage, the roles of you and your spouse in both your marriage and the business, and more.
If you or your spouse gained ownership of the business before your marriage, the pre-nuptial value of the business is considered a nonmarital asset and the owning spouse’s property. Any increase in value during the marriage is considered marital property, however, and is thus subject to equitable distribution. This means that the change in value of the business between the beginning and end of your marriage is accessible to both spouses. As you might imagine, the true value of the business and the actual income it produces for the operating spouse can become quite contentious issues.
Understanding your options is important, and business ownership during a divorce can present you with many of those options, some unfavorable. Matt Liebenhaut, divorce attorney for Tallahassee and surrounding areas, can help you protect your rights to your business assets.
Matt Liebenhaut is an attorney in Tallahassee, FL practicing in the areas of divorce, child custody, social security and private disability insurance law.