Getting a divorce can be an emotionally taxing process due to conflict between spouses and stress related to addressing and resolving financial issues and other concerns. The division of marital property is one of the most important factors in a divorce, and it can become especially complex for spouses who are business owners. By understanding the potential options for the division of business assets, divorcing spouses can make decisions that will protect their financial interests.

Marital Property Vs. Separate Property

When determining how business assets may be addressed during the divorce process, it will be necessary to understand whether a business is considered marital property. A business that a spouse owned before the couple got married will usually be considered separate property that is solely owned by that spouse. On the other hand, if either spouse founded or acquired a business after the couple got married, it will be a marital asset, and it will most likely need to be addressed during the property division process.

Business Valuation

One of the first steps to take when addressing business assets in a New York divorce is to determine the value of the business. A business valuation will usually be necessary regardless of whether a business is marital property or separate property, since this will determine the financial resources that will be available to each spouse. There are several ways to value a business, including evaluating the business's assets and liabilities, determining a potential purchase price based on recent sales of comparable businesses, or considering cash flow and profits to understand how the business's value may increase in the future. It will often be necessary to work with financial experts such as accountants and appraisers to understand a business's value.

Getting a divorce can be an incredibly stressful process, and it is likely to involve a variety of strong emotions, which can make it difficult to cope with the changes you are going through in your life. Fully considering the ways you and your family will be affected, the issues you will need to address, and the legal procedures that will be followed can be hard enough, and actually following through on these plans will likely add even more stress. To avoid being overwhelmed by the various legal, financial, practical, and emotional issues that may affect you during your divorce, here are a few tips you can follow:

Stay Organized

As you proceed with your divorce, you will have a lot of documents and paperwork to keep track of. These may include legal documents such as the divorce petition and any temporary orders issued by the judge in your case, as well as drafts of your divorce settlement or other forms or paperwork that will be submitted in court. You will also need to gather financial documents related to the assets you own, the debts you owe, and the income you and your spouse earn so that you can properly address issues related to property division and financial support. It is important to keep all of these documents in a safe place and make copies of everything. This will ensure that you will have access to all the information you may need during the divorce proceedings.

Get Control of Your Finances

As you separate from your spouse, you will need to make sure you will be able to meet your ongoing needs. Setting a budget will help you understand how much money you have coming in each month, what expenses need to be paid, and how much money is left over for other necessities such as food or medical bills. Additionally, it will be important to address any outstanding debts that you and your spouse may need to address during your divorce. By taking control of your financial situation, you can make decisions during your divorce that will protect your interests, and you can be prepared for financial success after your marriage has been legally terminated.

Legal separation may be an option when a married couple is considering changing their relationship, but the spouses are not yet ready to commit to a divorce. Legal separation offers many of the same protections as divorce—including legally binding decisions about the division of assets, spousal support, and child custody—while allowing for reconciliation or divorce. It can be a great way for spouses to test out their feelings about dissolution without deciding to legally dissolve their marriage. By understanding what legal separation entails, the procedures that must be followed, and the rights that apply to them, spouses can determine whether this may be a good option or whether divorce may be preferable.

Getting a Legal Separation in New York

In New York State, legal separations must be authorized by a court order or a written agreement signed by both spouses. A spouse can choose to file for a legal separation, which is similar to filing a divorce petition. When doing so, they will generally need to provide a stated reason or grounds for the split. The grounds allowed include cruel and inhuman treatment by the other spouse, abandonment, refusal of one spouse to provide financial support for the other spouse or the family, adultery, or one party serving a prison sentence for at least three years.

The process of divorce can be long and difficult, and there are numerous concerns that must be addressed before the legal dissolution of a marriage can be finalized. Issues that affect your family's finances are often among the most complex and difficult aspects of a divorce. As you make decisions about how to divide the property you own with your spouse, you will likely be considering how to make sure you will be able to address your immediate needs and the financial concerns that may affect you in the near future. However, it is also a good idea to be aware of the impact that your decisions will have on your long-term financial health, including the resources that will be available to you after your retirement.  By understanding how money in retirement accounts or pension benefits that you or your spouse have earned will be addressed during your divorce, you can make sure you will be fully prepared for the future.

The Basics of Retirement Savings & Pensions in Divorce

In a divorce, retirement savings and pensions are considered marital property. Regardless of who earned these benefits or whose name is on a retirement account, assets earned during your marriage are the property of both spouses. Marital property will be divided between you and your spouse based on what is considered to be equitable under New York law. While a retirement account such as a 401(k) or IRA will not necessarily need to be split in half, the funds in an account may be divided based on the applicable factors in your case, which may include the amount of other marital assets each spouse will receive, the needs of each spouse, the financial circumstances each spouse is likely to encounter in the future, the tax consequences of allocating different assets to either spouse, and other relevant concerns.

When it comes to the division of assets in a divorce, real estate can be one of the most complicated types of property to address. It is important for divorcing couples to understand their rights and responsibilities when it comes to ownership and division of real estate during the process of getting divorced in New York. Some key considerations to address in these situations include: 

New York's Marital Property Laws 

In New York, real estate is classified as either “marital property” or “separate property.” Marital property includes all assets acquired during the marriage, such as a jointly owned family home, vacation home, or any other investments that have been shared by both parties during the course of their marriage. Separate property includes any asset acquired prior to the marriage or through an inheritance.