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Posts Tagged divorce and business partners

Do I Have To Give My Spouse Part Of My Business In Our Divorce?

asset division, business planning, divorce and assetsWhen spouses are going through a divorce, one thing that always must be addressed is property division. However, when one or both spouses own a business, or even have an interest in a business, property division can be much more complicated. A common question spouses ask is: Do I have to give my spouse part of my business in our divorce? In Massachusetts, the short answer is No, but the answer isn’t that simple.

 

Under the property division statute in Massachusetts, Massachusetts General Laws chapter 208, section 34, the Probate and Family Court must consider the following factors in dividing the marital estate:

 

length of the marriage, the conduct of the parties during the marriage, the age, health, station, occupation, amount and sources of income, vocational skills, employability, estate, liabilities and needs of each of the parties, the opportunity of each for future acquisition of capital assets and income, and the amount and duration of alimony, if any, awarded under sections 48 to 55, inclusive. In fixing the nature and value of the property … Read More »



Does My Spouse Have an Interest in My Business When We Divorce?

divorce and assets Divorce and business, divorce and business partnersIn a divorce, money can be one of the biggest issues spouses fight over. However, when one (or both) spouses own a business, this can be an even more complicated (and sometimes uglier) fight. A common question business owners ask when they are going through a divorce is whether their spouse has an interest in the business. The short answer is yes, but it’s not as straightforward as you think.

 

Under Massachusetts law, all assets owned by spouses, regardless of whether or not they are joint assets, are marital assets. This can include a family owned business, even if only one spouse has an interest in that business. That means the business is a marital asset that is subject to division in equitable distribution. However, that doesn’t necessarily mean the non-business owner spouse will end up owning the business or having a financial stake in the business through the divorce. Massachusetts General Laws chapter 208, section 34 outlines factors the Probate and Family Court must consider in the division of marital assets. … Read More »



10 Things No One Tells You About Divorce

finish lineNot all divorce advice is created equal. For every good tip you receive from someone (don’t use your attorney as your therapist, keep those rants about your ex off Facebook), there are just as many unhelpful comments: “Don’t get mad, get everything!” Just no.

The best source for advice you can actually use are divorcés themselves. Below, 10 HuffPost bloggers and readers share the one tip they wish someone had given them during the divorce process.

1. Moving on is a marathon, not a sprint.

“The difference is, a marathoner trains for hours before the big race. Divorce strikes most of us unexpectedly with no training on how to get through it. Take things day by day and one step at a time until you find solid footing and each step doesn’t feel like you’re walking on quicksand. And realize that emotions shouldn’t be suppressed. As a man, I was raised in an environment where emotions weren’t to be spoken of — divorce taught me the opposite.” –Vidal Cisneros Jr.

2. Divorce feels a bit like death (without all the casseroles delivered to your door.)

“Losing your ex — and your … Read More »



Certain changes in financial behavior and conversations about money are sure-fire signs that your spouse is preparing to split up.

MoneyOver 25 years, I’ve worked on the financial aspects of more than 1,300 cases of divorce. Rarely are both spouses in sync when it comes to filing; one spouse is usually laying the groundwork before the other.

In hindsight, most people on the receiving end of the filing have their “aha!” moment. One homemaker told me that her husband began plying her with gifts and vacations; he also launched all kinds of projects to fix up their house so they could sell it and move to a smaller place. It was all totally unsolicited, much appreciated, and done with loving attention.

Six months into all this thoughtful behavior – as the couple closed on their new vacation timeshare, downsized to a beautiful condo, and planned for their next vacation – he popped the zinger one Saturday morning: “I want a divorce.”

For another client, the signs were a little more obvious: The bank called her husband to let him know that his mortgage was approved – the mortgage he was co-signing with his girlfriend

Divorce is an emotional, legal, and financial combat zone. There are actually websites devoted to secretly planning for … Read More »



Resetting Your Retirement After Divorce

retirementWhen couples divorce, long-term financial priorities sometimes receive the least attention. Many money issues are about immediate needs – where to live, how to handle everyday expenses and if there are kids, how to support their needs in two households, not one.

This is why retirement planning can face serious obstacles post-divorce. In marriage, a two-earner household has the advantage of splitting living expenses and pooling assets like retirement savings. After divorce, ex-spouses may walk away with their share of joint retirement assets based on how they negotiate that distribution.

However, returning to singlehood means taking on all housing, food, transportation and related costs alone. That generally means less money to save for retirement and other purposes. To assure a comfortable retirement, many experts advise individuals to save and invest over time so they can live annually on at least 70 percent of their pre-retirement income.

Divorce can be tough no matter what the circumstances, but best-case financial scenarios typically emerge from thorough, individualized pre-divorce planning. That generally requires each spouse to retain their own financial advisors much as they would their own legal … Read More »



Handling Your Divorce Like an Air-Traffic Controller

compromiseThe stresses placed on divorcing couples, who are making decisions about custody, spousal support, equitable distribution and parenting plans are not unlike those of air-traffic controllers, who are trying to safely land multiple jumbo jets coming in on multiple runways. Perhaps these aren’t life or death decisions, but that depends entirely on your perspective!

I can’t take credit for this brilliant and so-directly-on-point analogy, but am borrowing it for the sake of this conversation. I hope it’s useful to anyone going through the divorce process today, or for those stuck in the seemingly never-ending post-divorce arguments that annoy, irritate and frustrate us.

We embark on the divorce journey for many reasons. For some, it’s a joint decision made, when it’s clear that the marriage isn’t working. For others, it was one spouse taking the initiative to raise the flag and take those first steps. Some go voluntarily into the process, and some go kicking and screaming, maintaining their status as “victim” in their broken fairytale. Regardless of how the travel plans were made, you are nevertheless taking this trip, and are forced to make many inter-related decisions that will ultimately affect your … Read More »



Divorce Can Mean a Trip Down the Economic Ladder for Women

crying womanDivorce can be a one-way ticket down the road to financial instability for many women, especially for those who are middle class or low-income.

It can mean a loss of work hours, more time (and expense) devoted to childcare and a cold slap in the face when it comes to finding a job or finishing an education.

While working-class women tend to be hit harder, not having a job, money or credit of their own is a challenge that can affect women of all socioeconomic brackets, said Bruce McClary, spokesman at the National Foundation for Credit Counseling. “In a lot of situations you have that career interrupted… It can be very messy in that situation because they have to start right from scratch.”

This was the situation Michelle Bornemann found herself in when she and her husband began divorce proceedings more than four years ago. The Long Island, New York resident, who has two children, had worked for a title insurance company before they were born but has been largely out of the work force since.

“I have nothing to show for a … Read More »



Managing High Asset Divorces in Massachusetts

high net worth

All divorces can be stressful and important to spouses facing a divorce. However, handling divorces with a high asset value has some additional inherent complexities that not all spouses, or even all attorneys, are aware of.

When addressing high asset divorces, there are complicated issues that have to be addressed within alimony, property division, taxes, life insurance, and even child support. In handling such divorces, it often requires the attorney to review a large volume of documentation, particularly financial documents. Because these documents can be highly technical, a knowledgeable divorce attorney typically takes a “team” approach to such divorces, and includes financial professionals in the management of such a divorce. These financial professionals can include a business appraiser, tax professional or accountant, financial planner, forensic economist, and/or certified divorce financial analyst (also known as a CDFA). It is important that your attorney already have a team in place that they have been working with for years.

These professionals can help your attorney work through some very complicated financial issues relating to the divorce, and oftentimes these professionals are also knowledgeable of the law associated with the financial aspects of … Read More »



How to Protect Your Company From Your Business Partner’s Divorce

Before you formed your business partnership, did you vet your partners’ marriages along with their bank statements? You may not consider it until divorce proceedings are underway, but your partners’ spouses likely own a part of your company, whether you want them to or not.

business and divorceIn my day job as a financial strategist specializing in complicated (and often highly contentious) divorces, I rarely see a case where the day-to-day operations, valuation and ownership structure of a business is not affected in some way by a breakup. If your partner’s soon-to-be ex receives a part of the business in the divorce settlement, you’ll gain a new, unwelcome partner who now has a voice in how your business operates and, by extension, can impact your own net worth.

Michael Lees, a business attorney and partner at Solomon Ward Seidenwurm & Smith in San Diego, recommends including a contingency for divorce in your company’s setup. “Start with a well-drafted partnership, ownership or shareholder agreement that requires a partner’s spouse to sell his or her awarded interest back to the company (or to its co-owners) in … Read More »



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