Virginians from all backgrounds run businesses. Someone who goes to school for psychiatry or dentistry might open their own professional practice after securing state licensing. Adults may also have learned a hands-on trade that ran in their family, which led to them taking over the family plumbing business. People even start franchises as a way of running their own businesses and supporting a family.
However someone becomes a business owner, the company that they own and operate will likely be one of their most valuable personal assets. It will also potentially complicate a divorce, regardless of whether their spouse is directly involved in the company or not.
The business’s value can affect property division
Often, professionals start the businesses that they run during their marriages. Any amount contributed to the business while married can lead to claims of the company being marital property. Financial contributions from the other spouse and unpaid labor that they perform for the company could also open the organization up to risk during the property division process in the Virginia divorce.
Business owners will need to clarify what their business is worth and how much of the company’s value is marital property. They may then have to negotiate with their spouse carefully to create a property division arrangement that will protect their interest in the company.
Future revenue can influence support obligations
Both spousal support and child support depend in no small degree on the income of both spouses and their ability to pay support. When one spouse has given up earning potential to help the other focus on developing a company, they may sometimes have a claim to at least rehabilitative spousal support during the divorce.
It is often ideal for the family for the business owner to retain ownership and control of the company, but they may have to make payments to their spouse or make property division concessions elsewhere. When judges decide how to divide property and whether to award support, they will look at the totality of the family circumstances, including each spouse’s ability to run the business and outside employment opportunities, when deciding what to do with a company during the property division process.
Recognizing how business ownership can complicate Virginia divorces can help those who are preparing for negotiations or hearings in the family court better assert their rights with the assistance of an experienced legal professional.