Business Ownership in a Michigan Divorce – Getting Fair Market Value through Business Valuations

One aspect of Michigan divorces with which couples often struggle is how to divide their shared assets. If one of these shared assets is a business, the process can quickly become more complicated and emotional, particularly if both spouses want to keep their stakes in what they built together. Both spouses might also count on the income from their business to support themselves, further complicating matters.

Dividing a business interest through a divorce can be complex. It requires a business valuation to determine what the assets of a business are worth.  If the spouses disagree on the value of the company, an appraiser must be retained to provide an expert opinion to help the court in making an award.

Often, there are competing valuations from two different appraisers. When there are competing valuations, each appraiser would testify about how they determined the value and explain how they are qualified to make such a determination.

Bloomfield Hills family law attorney Lisa D. Stern can help protect your interest in your business during a Michigan divorce. For nearly 30 years, Stern has represented spouses in divorce proceedings and protected their rights, including their ownership of a business. Stern can help you through the process and protect your rights.

Potential Outcomes for Ownership of a Shared Business in a Michigan Divorce

  • Buyout: In this scenario, one spouse purchases or “buys out” the other’s share of the business. This often involves one spouse paying a lump sum or structured payments over time to gain full ownership.
  • Co-ownership: In some cases, both spouses may continue to own the business together post-divorce. This outcome requires a high level of cooperation and clear agreements on business operations and profit sharing.
  • Sell and Divide Proceeds: The couple may decide to sell the business and split the proceeds. This option is common when neither spouse wants to continue the business or when a buyout isn’t feasible.
  • Distributing Other Assets: Instead of selling the business, one spouse keeps the business while the other receives assets of equivalent value, like real estate or investments.

Tips for Keeping Your Business in a Michigan Divorce

Navigating a divorce in Michigan while owning a business can be challenging. However, with the right strategy and guidance, you can increase your chances of retaining your business. Here are some essential tips to keep in mind:

  • Understand the Value of Your Business: Get a professional business valuation. Knowing the exact value of your business is crucial in negotiations with your spouse.
  • Keep Clear Financial Records: Maintain distinct boundaries between your personal and business finances. This clarity can help demonstrate that your business should remain separate from marital assets.
  • Explore Buyout Options: Prepare to discuss how you could buy out your spouse’s share of the business, possibly using other marital assets or a payment plan.
  • Minimize Conflict with Your Spouse: A cooperative approach can lead to a more favorable outcome, especially when negotiating business ownership.
  • Consider Mediation or Collaborative Divorce: These alternatives to traditional divorce proceedings can provide more control over the outcome and may be more conducive to protecting your business interests.
  • Prepare for Financial Compromises: Be ready to make concessions in other areas to retain full ownership of your business.
  • Consult a Knowledgeable Attorney: Working with an experienced divorce attorney like Lisa D. Stern is crucial. A Michigan property division lawyer can provide valuable guidance and protect your rights throughout the process.

Contact a Detroit-Based Property Division Attorney Today

If you desire to maintain control or ownership of your business after divorce, the right legal help is vital. Attorney Lisa D. Stern can guide you through this tumultuous process and help you keep what you have worked so hard to create. Call us today.

Contact Attorney Lisa D. Stern

For an initial consultation with attorney Lisa D. Stern, call 248-335-5000 or complete our online contact form. You can discuss every aspect of child support with the utmost candor and confidentiality.