Under Florida law, there should be an equitable distribution of marital assets during a divorce. An equitable split means that the property should be fairly divided which is determined through evaluating several relevant factors. While an equitable distribution does not necessarily mean an equal split, it is common for marital assets to come close to a 50/50 split.
Marital assets, generally speaking, are those assets acquired during the marriage. Marital assets may include securities, tangible property, real property, and other property types. Even a business can be considered to be marital property. Because of this, many business owners have concerns that their spouse will get half their business in the event of divorce. While this may be a possibility, it is not actually what ends up happening.
Is My Spouse Entitled to Half My Business in a Divorce?
During divorce proceedings, all property of the divorcing parties will be categorized as separate or marital. Property that is deemed to be marital will be subject to equitable division. Some property can even be categorized as a combination of marital and separate. For instance, a business may be categorized as separate, marital, or both. This is due to the fact that a business may have been established prior to marriage but increased in value during the course of the marriage. Alternatively, one spouse may have contributed to the business in the form of time or other resources over the marriage and, therefore, at least a portion of the business may then be considered marital.
In order to be divided in whole or in part, a business must be valued during divorce proceedings. This is usually done through employing a professional such as a CPA or a larger organization like the National Association of Certified Valuators and Analyst. In order to value a business, there are various methods that may be applied. For instance, many valuation methods will use an ongoing value estimate. This means that the business will be valued in a way that assumes that it would continue to operate at a profit for a longer period of time. Alternatively, the liquidation method of estimation places a business’s value as being the total value of its liquid assets.
Once the business has been deemed to be a marital asset, separate asset, or both, and it has been valued, the court will determine how it should be distributed. Depending on how all of the other marital assets are distributed, among other factors, a court may divide business interests between the two divorcing spouses. This does not mean a 50/50 split and it is not very common to see a 50/50 split in regards to a business as a marital asset. Additionally, a spouse who founded a business will generally buy out the other spouse of any shares he or she may have received in a divorce.
Florida Family Law Attorneys
To learn more about how assets can be divided during divorce proceedings, talk to the knowledgeable attorneys at Orlando Family Team. We understand that distribution of the marital assets can have a substantial impact on your life and your financial future. Contact us today.