Tag Archives: division of marital property

Hinsdale divorce attorneyOwning a small business comes with many perks when compared to working for someone else. You set the schedule, make the big decisions, and reap the majority of the rewards. There are obvious downsides as well—statistically high likelihood of failure, more working hours, extra stress, and no health insurance to name just a few that most people can come up with off the tops of their heads. Yet, few people truly understand the full complexity of small business ownership until they go through a divorce. If you own a small business, your spouse, who may have nothing to do with that business, may be able to claim partial ownership during a divorce. When you own a business together, things get even more complicated.

Businesses Can Be Marital Property

Illinois divides marital property through equitable division. Marital property is anything acquired during the course of the marriage, including income, bank accounts, stocks, 401(k) accounts, pensions, real property, automobiles, furniture, and virtually every other type of asset or debt. This includes businesses. Property owned by each party before marriage remains nonmarital property. However, if you or your spouse owned a business before marriage and the other spouse became a co-owner, or contributed to the business through labor, or contributed to it with funding, it too will be considered marital property even though it was owned by one party before the marriage began.

Dividing a Business Often Means One Spouse Becomes the Sole Owner

For spouses who started up a small business together during marriage, dividing that business without ruining it can be complicated and in many cases, neither spouse has a desire to continue operating the business with the other. As such, the best option may be to give sole ownership to one spouse while the other gets the house, for example. In the best-case scenario, one spouse will be inclined to a buyout. In more complicated cases, neither spouse wants to give up their ownership of the business, and additional compromises will eventually have to be made either through mediation or in a courtroom, ordered by a judge.

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IL family lawyerDivorce is usually a time of drastic changes. Everything from your normal breakfast routine to where you sleep at night goes out the window during divorce. For many couples, selling the home becomes a necessity to manage finances. As the two spouses split up and live in different locations, paying the mortgage on top of rent becomes unmanageable, particularly when the two parties have to pay separate utilities and a plethora of other expenses that used to be shared. In fact, 61 percent of divorced couples end up selling the home. However, not all soon-to-be divorced couples sell the home, and in some cases, this is the best decision if at all possible.

If You Have to Sell the Home

Finances or moving out of town are two of the most common reasons that divorced couples sell their home. Selling the home can provide the best way to split the value of the property during division of assets, can allow both parties financial footing to start off anew, and can minimize stressful costs by getting rid of an expensive mortgage. After all, if one party ends up owning the house, they may not even be able to cover the mortgage by themselves. If you are selling your home during divorce, make sure to follow the tips below:

  • Discuss the full plan with your spouse before taking any other actions, as well as the pros and cons of selling or staying;
  • Divide the costs of cleaning, maintenance, renovations, and any other repair work evenly or at least keep close track of the costs;
  • Choose a realtor together;
  • Keep dialogue open with your spouse during the sale;
  • Hire an attorney before the sale goes through; and
  • Divide the assets. Marital property in Illinois is divided equitably.

Choosing to Keep the Home

For parents who can afford to keep the home, the stability that brings to your children may outweigh any other positives that selling the home has to offer. Additionally, older divorces may benefit by holding onto a home that they own outright. After all, late-life divorces are much more common now than in the past. In 2014, Americans over the age of 50 were twice as likely to get divorced than 50-plus-year-old Americans in 1990. For divorcing couples that choose not to sell the home, they, along with their attorneys, need to figure out an equitable way to divide assets, since the home (usually) cannot continue to belong to both parties. And, if there is a mortgage left to pay, the spouses must reach a decision on who is responsible for paying what. In some cases, the spouse who no longer lives in the home may be responsible for paying part of the mortgage.

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Dupage County community property division attorneyWhen you are married, that typically means that your finances are woven together, which makes things easier for you and your spouse to handle life’s expenses. This all changes once you decide to get a divorce. A divorce is not only the severing of your emotional relationship, but also your legal and financial relationship.

Like most things in life, diving into a divorce with little to no preparation is never a good idea. You should have certain things prepared and in order before you begin your divorce. Here are four ways you can get your finances in order before you begin the divorce process:

1. Take Inventory of Your Assets and Make a List of Your Debts

The first thing you should do when preparing for divorce is to make a list of your assets and debts. Your assets should include things like any real estate that you own, your vehicles, money in savings and checking accounts, investment accounts, retirement savings, furniture and household items, collectibles and any other valuables you own. Your debts can be things like a mortgage, an auto loan, credit card bills or any personal loans.

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Hinsdale IL asset division attorneyIt does not matter whether you and your spouse are divorcing amicably - you still have to divide your property between the two of you before your divorce can be finalized. While this process can be annoying at best and combative at worst, it is a necessary evil of divorce. Illinois courts look at the division of property as being equitable, rather than equal. You may not necessarily come out of the marriage with everything that you personally gained during the marriage. Dividing property during a divorce can be a careful game of negotiations, especially when it comes to high-value assets, such as a house or a vehicle. Here are a few common assets that most couples have and how they can be divided:

Your Home

Though the family home can be a source of emotional attachment for many people, the easiest way to decide what happens to the home is to sell it and split the profits. That would only work if you have equity in your home. If you have to sell your home for less than what you owe on your mortgage, you will have to determine who pays the remaining mortgage amount after it is sold. If one of you wants to keep the home and the other one does not, then the spouse who wants to keep the home can buy out the other half of the home, but you will need an accurate assessment of what your home is currently worth.

Your Vehicle

If you and your soon-to-be ex-spouse own a vehicle together, it can go the same way as the home. You can either sell the vehicle and split the profits, or one of you who wants to keep the car and buy out the other person’s half. Figure out what the current value of your vehicle is and then split that in half - that would be the amount your spouse should pay you if he or she wants to keep the vehicle.

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Illinois divorce lawyerIf you are going through a divorce, you are likely wondering whether or not you should sell your house. The answer to this question depends on your personal preferences, lifestyle, and finances. While selling the house is the ideal option for some individuals, keeping it makes more sense for others. Let’s take a closer look at the pros and cons of both selling a house and keeping it so that you can make a decision that is right for your situation.

Selling Your House

It may be in your best interest to sell your house and split the proceeds with your spouse. This is especially true if your children are grown and moved out or will go to college in a few years and you will not need such a large space for yourself.

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