Divorce Lawyer for Business Owners in Illinois

630-891-2478

Divorce Lawyer in Illinois for Business Owners

When a couple divorces in Illinois, their debt and marital property – the property they have accumulated and shared during their marriage – is subject to property distribution. Depending on your jurisdiction, it is either split equally (community property states) or equitably (equitable distribution states). Sometimes, marital property includes a business that the couple started together or, alternatively, one spouse started either before or during the marriage and continued to grow during the marriage. The business, under these circumstances, will also likely become subject to property division unless you take steps to safeguard it.

At The Law Firm of Erin N Birt PC (Birt Law), our divorce attorney in DuPage County understands the blood, sweat, and tears you put into starting and developing a business. We know you don't want to compromise that hard work in any shape or form. There are steps you can take, and our divorce lawyer will explain how to protect your business during a marriage or during a divorce. Call us at (630) 891-2478 to set up a consultation & planning meeting today.

How Will a Divorce Affect My Business in Illinois?

A divorce can affect every aspect of your life, including your business. How your business is affected will depend on a number of factors, including the law of the state that has jurisdiction. 

Some states are community property states which means that you may either have to: 

  1. split the business with your spouse, or 
  2. give your spouse other compensation equal to half of the value of the business. 

Other states, such as Illinois, use equitable distribution when dividing property. In these states, property is divided equitably or fairly between the parties. This may or may not be half of the business. Even so, it is likely you will be expected to give up at least part of the business, or its value, to your spouse. 

Following are some other factors that must be considered regardless of whether you live in a community property state or equitable distribution state.

Who Owns the Business

Did you or your spouse inherit the business from family? Is it clear that only one spouse supported and worked at the business? These are both considerations that will help determine how a business will be divided in a divorce. 

When Was the Business Started

If the business was formed prior to marriage, there are states that will maintain that it is premarital property and therefore not subject it to division. Also consider that in some states even if the business was started before marriage by one spouse, if the other spouse contributes to the business after marriage, it may be considered marital property, and therefore subject to being divided between the parties.  

When a business was started during the marriage, it will most likely be considered marital property and therefore subject to division under the rules of the state with jurisdiction.

Ways to Proactively Protect Your Business in Illinois

Fortunately, there are ways to protect your business so that you do not lose it, or part of it, in divorce proceedings. The best way to approach business protection depends on whether or not you are contemplating marriage and want to protect your interests, or if you are already married and fear a future divorce may harm your business. 

Prenuptial & Postnuptial Agreements

While no one wants to go into a marriage contemplating a divorce, it really is in your best interest to plan for the “what ifs” when you have a successful business you need to protect. A prenuptial agreement will help you do just that. It is an agreement made by two engaged parties wherein they address how assets will be divided in case of divorce. You are able to state in this agreement whether the business is even considered marital property and, therefore, whether it would be subject to division. 

A postnuptial agreement operates much like a prenuptial agreement, with the only difference being that it is entered into after marriage rather than before it. 

An Agreement to Buy/Sell

A buy/sell agreement is a way to establish how your spouse's interest in the business would be determined in case of divorce. You can also specify the amount of a cash award the spouse would receive for their share of the business in the event of a divorce. This type of agreement ensures that you will be able to keep your business. 

Ways to Protect Your Business During a Divorce in Illinois

If you have no contract, whether it's a prenup or an agreement to buy/sell, you can still take measures to protect the business. 

  1. Establish yourself as the sole owner of the business. Organizing documents should specify that the business is not transferable in the event of a divorce. To note, you may still need to provide a cash award to the non-titled spouse at the time of divorce.
  2. Keep your records. Even things like office furniture and office rent should not be paid with marital assets and maintaining records to clarify this is important.
  3. Separate finances. You should not mix business and personal expenses, and by not doing so, you can show that the business is separate. The opposite is true if you do commingle funds.
  4. Spouse as an employee. If your spouse worked at all, even if very minor, keep documents proving that the spouse was paid for their services. 

Generally, you want to maintain clear and thorough records of just about everything related to your business. 

Keep Your Business Safe: Get a Divorce Lawyer in DuPage County

Even with any of the safeguards in place, a non-titled spouse may still pose a challenge to your business. They may try to inflate their contributions or obtain an appraisal that overvalues the business. The latter, at a minimum, is why having a divorce lawyer who is resourceful and knowledgeable is key to countering these tactics. 

At The Law Firm of Erin N Birt PC (Birt Law), our Illinois divorce attorney for business owners will provide you with all your legal options and help you keep your business intact. Contact us at (630) 891-2478 to schedule a consultation & planning meeting today. With the right lawyer, you can walk away from your marriage with your livelihood protected and your hard work secured.

Our Attorneys

  • Erin Birt

    Since 2003, Erin N. Birt, J.D., CADC has focused her practice on pa...

  • Tyler Birt

    Since 2007, Tyler Birt has been a legal assistant and bookkeeper fo...

  • Karen Hansel

    As Administrative Assistant at Birt Law, Karen’s involvement in dai...

Recent Case Results

  • Discover how Erin Birt’s expert mediation turned a challenging court-ordered session into a successful resolution. Learn how individualized attention and strategic guidance helped a couple navigate parenting issues, overcome frustration, and achieve a positive outcome in their divorce mediation. Read the full story of transformation and empowerment. Read On

  • Discover how our Restorative Divorce approach helped a working mother in DuPage County navigate a challenging divorce. By focusing on cooperation and proactive mediation, we minimized court involvement, reduced legal fees by 35%, and ensured a smooth transition for her and her children. Learn more about our effective strategies for amicable divorce resolution. Read On

  • In a challenging divorce, Attorney Erin Birt resolved parenting conflicts for the best interests of a teen daughter. Mother Sarah was concerned about father John's disinterest, while John felt Sarah was controlling. Erin, serving as GAL (Guardian ad Litem), utilized mediation skills and investigation protocols to prioritize the teen's well-being, prevent litigation, and repair co-parenting harmony. Read On

Family Centered Divorce ∙ Mediation ∙ Co-Parenting

Birt Family Law is the family centered law and mediation practice with a focus on Restorative Divorce; offering creative and supportive legal and mediation solutions with one goal: keeping the separating family out of court and working together towards a positive resolution.

We offer multiple options to achieve this goal including mediation, coaching, co-parenting strategies, and Restorative Divorce services. 

Are we the right fit for you?

Birt Family Law is committed to keeping the separating family out of court and working together towards a positive resolution.

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