How Does NC Equitable Distribution Affect a Business?
In one our of earlier blogs, we discussed how NC equitable distribution works, how property is classified, and how equitable distribution can be requested. This entry will focus on how equitable distribution affects the division of a jointly-owned business between the parties to a divorce.
How Can a Business be Split Up?
A jointly-owned business can take years of hard work to build up and the process of equitable distribution can seriously impact the business, so it is very important to consult with an experienced family law attorney to discuss the options available to you.
There are several commonly used methods of how a jointly-owned business can be distributed:
- A buyout of one spouse’s interest in the business;
- Continuing to jointly own the business; or
- Selling the business and dividing the proceeds.
The terms of the business split can be drafted in a separation agreement, which is the most cost-effective method of approaching this task. Otherwise, the decision of how to split the business can be made by a judge during a NC equitable distribution proceeding. It is important to consider the pros and cons of any method used before agreeing to it.
When Can a Party Request Equitable Distribution?
It is important to note that equitable distribution is not automatically provided by the court. Parties must ask the court for equitable distribution and can do so at any time before the judgment for divorce is entered. Additionally, NC equitable distribution can only be requested once the parties are separated.
It is important to note that if you do not file for equitable distribution PRIOR to the absolute divorce being granted, you waive your right to equitable distribution. The same rule applies for alimony. After the judgment for divorce is entered, a separate hearing will be conducted on the matter of equitable distribution.
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