A divorce in the state of Washington is particularly complex when the parties have a privately held business. The business is a marital asset. Because it is a marital asset, it is subject to valuation and equitable division as part of the estate. Valuing the business, determining how to divide it and executing documents are all part of the process when a divorce involves a privately held business.
It is unusual to continue joint ownership of the business after a divorce. Typically, the parties arrange for one party to buy out the other’s interest. Determining ownership isn’t as simple as which party works in the business or has their name on ownership documents. Instead, absent a prenuptial or postnuptial agreement, the business is generally a marital asset.
The parties can expect to engage in document production and a valuation process. It is common for the parties to have competing opinions as to the value of the business. With differences of opinion, documentation and supporting evidence is particularly critical to success in the legal process.
One further issue that can complicate a divorce involving the business is when the party, or the couple together, does not wholly own the business. The parties must determine the value of their individual interest in addition to determining the value as a whole. There are various options for resolution, including immediate purchase and long-term payout agreements. A lack of liquidity is not accepted as a barrier nor an excuse for failing to include the business as part of the marital estate.
A divorce attorney may assist a person who faces a divorce that involves a business. The attorney may help them value the business. In addition, the attorney may help them examine their legal position and petition the court for a fair and equitable disposition of the business interest as a marital asset.