How Are Business Assets Divided in an Illinois Divorce?
Posted on September 23, 2020 in Division of Assets
In an Illinois divorce, a wide range of assets can be considered marital property, which must be equitably distributed between spouses. This includes joint bank accounts and many properties that you may consider to be part of the household, including the home itself, vehicles, furniture, and more.
However, marital property also likely includes privately owned businesses and other properties owned in only one spouse’s name, provided that they were founded or acquired during the marriage. When you or your spouse have significant business assets, it is important that you understand how the division of property may work in your divorce.
Valuing Marital Business Assets in Illinois
If you have business assets that you want to protect in your divorce, you should first determine whether any of them may be excluded from the marital estate. Businesses that you owned prior to your marriage may be considered non-marital property, especially if they were designated as such in a prenuptial agreement. Businesses purchased with money from a gift or inheritance specifically in your name may also be considered non-marital assets.
For any business assets that are marital property, you should get a valuation from a financial professional that accounts for assets, income, and fair market value. Be prepared for your spouse to obtain a competing valuation, which may mean you need to reach a resolution through negotiation or litigation.
Deciding the Best Way to Divide Business Properties
Illinois law does not require you to split all assets in half in your divorce. Rather, it ensures that each spouse receives a fair allocation based on many factors, including each spouse’s income, earning capacity, and contributions to the marriage. This opens the door for different arrangements to suit your needs and preferences, especially if you and your spouse are willing to negotiate. Some options include:
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Selling the business and dividing the income. This may be the best option if it provides greater financial benefits to both spouses than keeping the business, or if no other agreement is possible.
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Obtaining sole ownership of the business in exchange for other assets. If keeping the business is important to you, you may consider ceding a greater share of the marital home, financial accounts, or other properties.
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Maintaining co-ownership with your spouse. If both of you are invested in the business and rely upon it for income, you may choose to continue owning it jointly after your divorce. If you do so, make sure that you and your spouse can maintain an amicable relationship and communicate and cooperate effectively.
Contact a Wheaton Asset Division Lawyer
At the Andrew Cores Family Law Group, we have experience representing clients in complex divorces involving high assets and business properties. We can connect you with financial professionals for your business valuation, advise you in negotiations with your spouse, and represent you in litigation if necessary. Contact a DuPage County property division attorney at 630-871-1002 to schedule a free initial consultation.
Sources:
https://www.ilga.gov/legislation/ilcs/documents/075000050k503.htm
https://www.americanbar.org/groups/real_property_trust_estate/publications/probate-property-magazine/2019/march-april/three-options-a-private-business-a-divorce/
