Divorce for Corporation Owners in Texas

 Posted on March 22, 2024 in Property Division

When one or both spouses own a company that is incorporated, divorce can become complicated. Even if one spouse had nothing to do with the company’s operations, the court may find that that spouse contributed to the other spouse’s ability to focus on the corporation by taking care of the household and children. A lot of decisions will need to be made about how corporate ownership and rights to future profits will be divided. Generally, spouses in Texas own every marital asset 50/50. Unless you have a prenuptial or postnuptial agreement in place setting aside the corporation as one spouse’s individual property, the court is likely to consider the company part of the marital estate. An experienced McKinney, TX divorce lawyer for business owners can help you through this highly complex divorce situation.

Do We Need a Business Valuation for Our Corporation? 

A business valuation is likely essential. To properly divide your ownership interests in a business, you need to know what the corporation is worth. Your attorney will likely recommend bringing in a business valuation professional to help determine the value of your corporation before asset division can take place.

If Only One Spouse Worked on the Corporation, Does the Other Spouse Have an Interest? 

If, for example, a wife owned and operated a corporation while her husband had no involvement, the corporation could still be considered part of the marital estate. The husband may have supported his wife’s endeavors in other ways, such as by taking care of the children while the wife worked late.

What if One Spouse Owned the Corporation Before Marriage? 

If, for example, a husband owned a business before divorce and never intermingled the business’s assets with the marital assets, there is some chance that the business may be considered his separate property. However, if the business increased in value or the husband contributed corporate profits to the marriage, such as by using money earned through the business to buy a house for the family, the business could still be considered community property.

What if We Owned a Family Business and Worked Together? 

If both spouses co-owned and co-operated the corporation, some difficult decisions will be made, including: 

• Can you continue working together after the divorce? 
• Will one of you buy out the other’s interest in the corporation? 
• Is it better to sell the company and divide the profits? 
• Would the business survive without one of you?

Dividing ownership interest in a corporation can be highly complicated and must be handled by a skilled attorney.

Contact a Collin County, TX Divorce Lawyer for Corporation Owners

The Ramage Law Group is skilled in dividing corporate ownership interest during the divorce process. Our McKinney, TX divorce attorneys for business owners embrace highly complex cases and will strive to create an innovative solution that protects your right to a fair division of assets. Contact us at 972-562-9890 to arrange a confidential consultation with an experienced lawyer.