Do I Have to Dissolve My Professional Practice If I Get Divorced?

 Posted on December 23,2022 in Divorce

Divorce is full of challenges and frustrations, and for most couples, asset division is one of these. For spouses who own or manage a professional practice, the idea of dividing something so intimately connected with one’s own labor, ability, and identity may feel insulting. Nevertheless, Michigan law requires all marital assets to be divided, and professional practices are rarely excluded from these. If you are a dentist, psychologist, physician, attorney, consultant, or any other professional who has their own company, read on and then contact a Michigan divorce attorney for assistance with your case. 

Is My Professional Practice Marital Property? 

Professional practices are built carefully with years of effort. Often, even if only one spouse is involved in working with a professional practice, both spouses have contributed to the worth and development of the practice over the years. This is especially true if one spouse worked while the professional spouse pursued an education and got their business off the ground. Practices begun after a couple is already married are considered marital property in Michigan. 

Even if a practice was opened before the spouses got married, any increase in the value of that practice is usually marital property, even if the other spouse was hardly involved in the practice. Having a prenuptial or postnuptial agreement may protect one spouse’s exclusive ownership of a professional practice, but not always. 

How are Professional Practices Divided? 

While the professional practice itself cannot be divided, its value can. Of course, this begs the question - how is the value of a professional practice assessed? A professional business valuator can help you determine the value of your business by first choosing the correct appraisal method and then taking into account your business’s assets, debts, invoices, inventory, and goodwill. 

Once the value of the professional practice has been assessed, a divorcing couple needs to decide how to divide it. Often, one spouse will “buy out” the other spouse’s portion of the value using other marital assets. Every divorce involving a business is different and spouses may need to get creative while dividing a business, especially if it makes up the majority of a couple’s net worth. A Michigan divorce attorney can help throughout the entire divorce process, including the asset division portion, so that each spouse gets their fair share of marital property. 

Meet with Our Farmington Hills, MI Divorce Lawyers

At Elkouri Heath, PLC, we know that many years of hard work, education, and personal investment have gone into making your professional practice successful. Our Novi, MI asset division attorneys fight hard for our clients’ property rights in their divorce and we will do the same for you, so you can be sure of getting the best deal possible out of your divorce. Call our offices today at 248-344-9700 to schedule a free, confidential consultation. 

Source: 

http://www.legislature.mi.gov/(S(o2ugewdfitilkzq2soalbpvf))/mileg.aspx?page=getObject&objectName=mcl-552-401