What Happens to My Business During an Illinois Divorce?

 Posted on April 08, 2025 in Property Division

The division of property and assets is a standard procedure during divorce proceedings. Your business is considered one of your assets. An experienced Cook County, IL divorce attorney will walk you through the business valuation and help you understand whether the company is subject to equitable division. Without legal representation, you may face challenges in securing a fair share of assets.

When Is a Business Considered a Marital Asset?

When it comes to property division, Illinois divorce law abides by the equitable distribution method. Unlike community property states, assets and debts are not divided equally. They are divided fairly. Your business is a marital asset if you started or purchased it during your marriage. However, if you had the business before your marriage, it may be a separate asset, not susceptible to division. There are exceptions, but to know for sure, you need an attorney to assess your unique circumstances. For example, if you have a valid prenuptial agreement, you may have protections in place for your business.

Do You Need a Business Valuation?

Couples sometimes disagree over the value of a business when divorcing. To ensure fair and equitable distribution, you need a business valuation. This is among the most complicated processes during a divorce, requiring an understanding of the three methods used to value a business:

• Income approach: This method determines value by assessing anticipated profits and current cash flow. 

• Market approach: The value comes from comparing the sales of similar businesses in the area.

• Asset approach: This strategy bases the business’s value on the value of assets belonging to the company.

The asset approach is generally used when the income and market approaches do not produce a value. Spouses are often surprised to learn that their businesses have more value than they expected.

What Can You Do To Keep Your Business?

If your business is defined as a separate asset, it will be yours to keep. However, if it is a marital asset, that does not mean that your spouse will automatically become a part owner in the company. You generally have two options to ensure the business remains yours. You can negotiate by giving up other marital assets in exchange for 100 percent ownership, or you can offer a buyout. If you have the funds, you may purchase your spouse’s share of the business, making you the sole owner. 

Contact a Chicago, IL Divorce Attorney for a Free Consultation

The division of assets can be one of the most challenging and contentious parts of the divorce process. It is not uncommon for both parties to have questions about Illinois divorce law and how it will impact their assets. An experienced Cook County, IL divorce lawyer at The Law Office of George J. Skuros can address your concerns and shed some light on the future of your business. Call 312-884-1222 today to schedule your free consultation.