In an equitable distribution state such as New York, the law requires a division of your property in a way that is fair to both you and your spouse when you divorce.
Unfortunately, some assets are not easy to divide. A business that you and your spouse own together cannot be divided into two separate piles, one for each. However, there are options for dividing a family business in a divorce, and Forbes describes some of the most common.
The most frequently used option is for one spouse to buy out the portion of the business owned by the other spouse and continue to run the business alone from that point on. This option may be particularly appropriate if either you or your spouse owns a larger share of the business than the other or if one of you founded and owned the business prior to the marriage.
2. Joint sale
Another option is for you and your ex-spouse to sell the business together and then split the proceeds between the two of them. This may be a good option if you founded the business together and each hold an equal stake in it. While it can be emotionally difficult, it gives you both freedom and liquidity to pursue your own solo ventures. On the downside, the completion of the divorce process may be contingent upon the sale of the business, which may prolong it beyond expectations.
3. Continued business partnership
While it may not happen often, another option is for you and your ex-spouse to continue running the business together following your divorce. This may require you to draft a new partnership agreement that redefines your roles.
A continued business partnership may only be possible when you are able to put aside your personal feelings to keep the business relationship professional.