When Divorce Meets Business Ownership

Coordinating valuation, cash-flow, and tax with family-law strategy

For business owner-operators, the company is often the largest marital asset and the family’s income source. The goal is to divide fairly while keeping the business healthy.

Tracing & Classification

Determine what portion is marital versus non-marital (premarital ownership, gifted shares, or inheritances). Keep strong records; avoid commingling.

Valuation Method & Date

Choose a qualified valuator; agree on income versus market methods, normalization adjustments, and treatment of customer concentration. Discuss how the valuator will be paid. The valuation date matters—tie it to a logical event.

Cash-Flow vs. Support

Balance reinvestment needs with child/spousal support. Over-extracting cash to fund a buyout or support can harm both sides long-term.

Creative Structures

• Installment buyouts with interest and security (pledge of shares).

• Hybrid deals combining cash, notes, and other assets.

• Covenants protecting operations (no sudden salary cuts or asset sales to starve value).

Bottom line: A workable settlement protects the company, the payor’s ability to earn, and the family’s stability.

Our family law and corporate teams collaborate to resolve owner-operator divorces with practical, finance-savvy settlements.