Equitable distribution--(how property is divided in divorce is governed by Section 20-107.3 of the Code of Virginia.)- Essentially, one of you will be forced out of the business and it is usually the least involved spouse. Assuming the business has value. you will likely be ordered to pay a monetary award to your wife for her interest in the business. This is a complicated issue and you should seek counsel.
The options are she sells you her half, you sell her yours, you sell the whole business and split the proceeds, or you continue working together. The first step is to value the business and the nonbusiness assets and try to equitably divide them. You may need to speak to a family law attorney for help.
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You and your wife can settle your differences, including the disposition of your business, with a separation agreement or property settlement agreement. You may do this on your own, either or each with an attorney, or through mediation.
If you are unable to reach an agreement, you can ask the court to divide all your marital property and debts through the equitable distribution process, link to Section 20-107.3 below, as part of your divorce case. As a starting point, the judge will classify all your property, separate, marital and hybrid, including this property, and the disposition of this property will depend on the overall equitable distribution. Ultimately,if you cannot continue as co-owners, one of you will have to either buy out the other or the business will be sold.
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