Dividing a family business in a divorce brings stress, especially when emotions and finances collide. In Massachusetts, the court treats the business like any other asset, but valuing and dividing it involves complex steps.
Business as marital property
Massachusetts courts divide all property, regardless of title. That includes a family business started during the marriage or one that grew significantly during it. Even if you started the business before the marriage, its appreciation in value may count as part of the marital estate.
The court considers each spouse’s role in the business. If one spouse ran the business or supported the household while the other built it, that contribution matters. This input can influence how the court divides the business’s value.
Valuing the business
You need a proper valuation before dividing the business. Courts usually assign neutral financial experts to determine the business’s worth. They examine the company’s earnings, assets, debts, and future potential.
Sometimes, one spouse wants to keep the business and offers to buy out the other’s share. In that case, the court may award the business to one spouse and balance the division with other marital assets.
Keeping the business intact
Massachusetts courts aim to avoid disrupting businesses that produce income. Splitting ownership doesn’t work well if the couple can’t cooperate. Often, one spouse keeps full control, and the court compensates the other through different assets.
What this means for you
If your divorce includes a family business, expect a detailed review. The court will examine financial records, business performance, and both spouses’ contributions. You can expect the court to aim for a fair division, not just a 50/50 split.