People who own and operate a business in Illinois might be worried about how their company will fare if they get divorced.
Not surprisingly, what happens to your business largely depends on your particular circumstances because Illinois courts divide marital assets and debts according to “equitable distribution.”
Divorce is never easy, especially when it involves the division of assets. The distribution of business property that one spouse labored hard to establish might be one of the most difficult aspects of dissolving a marriage.
Our team of Illinois attorneys at Diamond Legal have decades of experience in divorce law and can assist you in understanding the influences that may impact the court’s decision in your case. In this blog, we’ll highlight a few points that will give you a better idea of what to expect in terms of the division of your company assets.
What is equitable distribution, and how does it work in Illinois divorce cases?
Equitable distribution is a legal term used in divorce cases that refers to the fair and reasonable division of marital assets and debts between the spouses.
In Illinois, courts use the equitable distribution method to divide assets and debts, as opposed to splitting everything in half.
Unlike other states that divide the marital property 50/50, Illinois instead considers a variety of factors to determine an asset division arrangement to come to an arrangement that is fair for both spouses.
How will the value of my Illinois business be considered?
This depends on your particular circumstances, as well. In some situations, businesses may not have any value. A personal service business may only have value if you are working in it.
The easiest way to determine whether or not your business has a market value for a divorce is to consider whether you could sell it today, and how much someone would pay for it.
Some people providing a service-based business out of their home may have a business that nobody would buy.
Therefore, the value of the business may be whatever you could get if you liquidated all of your equipment. This could be the market value of all the used equipment (desk, computer, office chair, printer, etc.)
Other individual businesses may have a market value including intangibles, such as goodwill, customer lists, etc. In many situations a qualified expert witness may be needed to provide the court with an opinion of value.
The expert witness for valuing a medical practice or professional service business may be quite different from an expert witness for a widget manufacturing company.
Can I keep my business if I get divorced in Illinois?
Unfortunately, there is no one definitive answer to this question. Every divorce is different.
Generally, the court will try to divide assets equitably between the spouses, so it is possible that the business could be awarded to one spouse or the other.
If you are worried about what might happen to your business in a divorce, it is best to speak to a divorce attorney like the ones on our team at Diamond Divorce Law who can help you understand your specific situation and options.
What should I do if I’m not happy with the court’s decision regarding my business assets?
If you are not happy with the court’s decision regarding your business assets, there are a few things you can do.
- First, you can appeal the decision. This will allow you to present your case to a higher court. This can be a costly and time-consuming process. You will also have to have a argument to convince the appellate court that there is a legal basis to change the judge’s ruling.
- Second, you can try to negotiate a settlement with your spouse. This may be difficult once the court has ruled on the matter. It would be better to negotiate a settlement with your spouse before the court is made a ruling on the issue.
- Finally, you can try to negotiate a separation agreement with your spouse. This agreement will outline how the business will be divided between the two of you.
Can spouses who are divorcing agree to a different arrangement for dividing their businesses than what would be ordered by the court?
Generally, if a divorcing couple cannot come to an agreement about the division of their business, the court will step in and make a determination. The court will assign a fair market value to the business and frequently divide all assets equally between the spouses.
However, in some cases, the parties may be able to agree to a different arrangement that is approved by the court.
This could include assigning a different value to the business or giving one spouse full ownership of the business. Whatever arrangement is made, it is important to have it put in writing and signed by both parties and approved by the court.
Contact an Illinois divorce attorney today
If you are a business owner in Illinois and are going through a divorce, contact our team of experienced divorce attorneys at Diamond Legal. Our McHenry attorneys will help guide you through the entire legal process while keeping your best interests at heart. Contact us today to schedule a consultation.
DISCLAIMER: Any information contained herein is solely for informational purposes. While it is important that you educate yourself, nothing herein should be construed as legal advice or create an attorney-client relationship. For specific questions, we urge you to contact a local attorney for advice pertaining to your specific legal needs.
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