Sometimes spouses who own small business get divorced in Texas. Dividing a small business in a divorce can have special challenges. Read this white paper I wrote about the Top Five Concerns Regarding Small Business Ownership and Divorce in Texas. To summarize, the five points are:
- What type of entity is the business – corporation, partnership, or sole proprietorship?
- When was the business formed? Different rules apply if it was formed during the marriage versus before the marriage.
- Have there been changes in the formation since the business was started?
- Who runs the business day-to-day? Will one spouse operate the business going forward or is there a dispute about who and how the business will continue to operate during the divorce?
- Where do the customers come from? In determining value of the business, one consideration will be whether the customers come to the business solely because of the reputation of the business (called commercial goodwill) or because of the reputation of one of the spouses (called personal goodwill).
When spouses have a small business and are getting a Texas divorce, it is critical to hire a Texas board certified family law attorney to handle these complex issues.