What Happens During Divorce if I Own a Family Business?

 Posted on August 11, 2026 in Property Division

The cost and difficulty of a divorce can vary significantly depending on the divorcing couple's finances. Owning a family business can often make the process more difficult. If you and your spouse own a business, either together or separately, you might be worried about what will happen to it during your divorce.

Determining the value of a business and how it should be handled can cause conflict during a divorce. A Wheaton, IL divorce attorney can help business owners with their divorce, explain your options, and protect your financial interests. At The Stogsdill Law Firm, P.C., our attorneys have over 100 years of combined experience. As one of the most prestigious firms in DuPage County, we handle divorces involving business owners with care and attention to detail.

Should We Sell the Business in an Illinois Divorce?

Illinois follows the rule of equitable distribution. This means that marital property is divided fairly, but not always equally. Illinois courts consider several factors when dividing marital property. These include each spouse’s income, needs, and contributions to the marriage. Of course, dividing a business is not as simple as dividing the funds in a bank account.

Spouses have different options for handling a business during divorce, depending on the situation. One option is to sell the business and divide the proceeds. Another option is for one spouse to buy out the other spouse’s interest. In some cases, former spouses may choose to continue running the business together after the divorce.

 For some divorcing couples, selling the business is inconceivable. They may have spent years building the business and not want to sell it. Other couples might see divorce as a chance to leave a business or working relationship they no longer want to continue.

How Can You Value a Business in a 2026 Divorce?

Before spouses can decide what to do with a business, they usually need to know how much it is worth. An accurate valuation can help spouses negotiate a sale, buyout, or other property division agreement. A business valuation expert can review the company’s assets, debts, income, and expected future earnings.

 Once the business is valued, you can make an informed decision about what to do with it. An experienced Illinois divorce attorney can explain how proceeds from a business sale or buying out your spouse will impact your divorce settlement.

How Do You Determine What Portion of a Business Is Marital?

A business started before marriage may be non-marital property. Any increase in its value will also usually remain non-marital (750 ILCS 5/503). However, the marital estate may be repaid for money or work that helped the business grow.

For example, one spouse may have used marital money to support the business. A spouse may also have spent a great deal of time helping the business increase in value without receiving fair pay. In either situation, the marital estate may have a right to reimbursement. Business and personal funds can be difficult to separate. A forensic accountant may review the financial records to trace the money and help determine what is marital property.

What Are the Most Common Business Valuation Methods in Illinois?

Determining a fair value for the business is often an important part of the divorce. Illinois courts and business appraisers commonly use three methods to value a company.

The asset approach looks at the value of everything the business owns, minus its debts. The income approach looks at the business's ability to generate future income. It often uses past earnings to estimate what the business might earn later. The market approach compares the business to similar companies that have recently sold.

Each method could produce a different result. In an Illinois divorce, an appraiser will choose the method that best fits the type, size, and financial history of the business. In some cases, the appraiser may use more than one method.

Is a Divorce Trial Necessary to Divide a Family Business?

Not every divorce involving a business ends up in a courtroom. Many spouses reach an agreement through negotiation or mediation. This may help them avoid the cost and stress of a trial. A settlement can also give both spouses more control over the outcome, rather than leaving the decision to a judge.

That said, a trial may become necessary if the spouses cannot agree on the value of the business or how it should be divided. This can happen when one spouse wants to keep the business and buy out the other spouse's share, but the two sides disagree on a fair buyout amount. If the spouses cannot agree, a judge will review the evidence and decide what should happen to the business interest.

How Can Business Owners Protect Their Interests During a Divorce?

Business owners can take steps early on to protect what they have built. Keeping clear financial records is one of the best ways to protect a business interest. Accurate records can help show when the business was formed, where its money came from, and how its value changed during the marriage.

A prenuptial or postnuptial agreement might clarify how the business will be handled if divorce becomes likely. Working with an experienced attorney and a qualified appraiser early in the process can help business owners understand their options and avoid costly mistakes.

Staying organized and getting help before issues come up can make the divorce process smoother and more certain.

Contact a Wheaton, Illinois Property Division Attorney

To learn more about protecting and dividing business interests during divorce,  

contact an experienced DuPage County, IL divorce lawyer from The Stogsdill Law Firm, P.C.. Call our office at 630-462-9500 to schedule a confidential consultation.