People who are plugged into what is popular can potentially create new businesses with a good chance of success. Social media platforms allow for an integrated system in which people can market and allow for ordering in a relatively streamlined fashion. Many entrepreneurs take social media trends and convert them into successful business strategies.
However, the pressure of starting an online business can be hard for people to handle. The amount of time it takes to develop and execute a concept can put strain on a previously happy marriage. People may spend hours a week responding to messages, filming videos and shipping products. Resentment about the focus on marketing or the financial investment involved can lead to a degradation of the spousal relationship. Even in cases where the business doesn’t negatively impact the marriage, it can end up becoming a complicating factor when spouses divorce.
What issues do spouses need to address when one or both of them has invested in a business?
What happens with employment
The more successful a small business becomes, the more likely both spouses are to work for the company. In many cases, both spouses may have begun to treat the business as their main source of income. That can lead to complications during the divorce because one of the spouses may need to transition to outside employment. If both spouses intend to continue working at the company, then they likely need to negotiate very specific terms to continue working together.
How to address the company’s value
While only one spouse may have their name on company ownership papers, the use of marital income to start the business likely makes it a marital asset. The more marital resources went toward the establishment and improvement of the company, the greater the likelihood of the company’s value being marital property in the eyes of the courts.
The spouses have to determine what the business is worth and then negotiate with one another to appropriately integrate that value into their property division decisions. The business can also lead to a request for spousal maintenance from the non-owner spouse, especially if they left an outside job to help develop the company.
Particularly in cases where spouses manage to arrange for uncontested divorces, they may be able to preserve the business’s value despite the divorce proceedings. Those hoping to continue developing their business even after divorce may need to prepare to make concessions in other key elements of the property division process.
Complex divorce proceedings often force people to set specific priorities. Spouses who can agree on what their company is worth and how to address its value can sometimes reach amicable arrangements that allow for uncontested divorce proceedings.
