Figuring Out What a Business is Worth - for a Divorce Case

Will your divorce include decisions on how to value and divide a family business?  If the answer is yes, you need to find a good lawyer experienced with business, financial reports, valuation methods, and divorce law.  This is one of the types of a divorce where do-it-yourself methods are not advisable.  Continue your homework, study this website, and work with a good attorney.

Hire Legal Help in Medium or Large Businesses

This is where the spouse that owns the business, or the non-owner spouse has the greatest opportunity to get a large return on their efforts.  If the business is worth $50,000 or over you should invest any money and effort needed to properly evaluate the business.  You will need to work with a team of people to get the most out of the situation.  The team includes your attorney, an accountant, and a certified business appraiser. 

Differences in Business Valuation

Small (under $3 million dollars in annual sales) business is a tricky thing.  The same business valued at $50,000 by one appraiser may be valued at $200,000 by another appraiser.  Depending on the side you are on, it is critical that you take advantage of all legal tools available to maximize your settlement.

Divorce, Business and IRS Taxes

Another side of this issue is federal income tax.  This is a key area to check when analyzing a business. Depending on the tax situation, $50,000 may be worth only $10,000 to the spouse who receives the business.  Or that same $50,000 may be worth $100,000 if the potential tax treatment is beneficial.

  When a family business is caught up in a divorce, it seems a universal rule that the spouse who owns the business presents that the business is going downhill two years before the divorce.  The other spouse presents the picture that the business has reached the size of IBM. The actual truth is somewhere in between. It takes a business mind to uncover the truth. Businesses are extremely complex and have many opportunities to manipulate assets.

Bottom Line:  If a business is at stake, your potential settlement can vary by hundreds of thousands of dollars.  Don't do it yourself.  Get a qualified professional.

 

Divorce can be the single most important event in your life.  Make sure you gather lots of information so you can make informed decisions.  Many people can benefit from the advice of a good, honest, loyal divorce attorney.  The Divorce Center can provide a divorce attorney that can help you protect yourself.  A lawyer is not an expense in a divorce case - they are an investment. We help clients in Hernando County, Pasco County, Pinellas County, and Hillsborough County. Our service area includes Tampa, Clearwater, Largo, New Port Richey, Brooksville, Dade City, and the New Tampa area. CONTACT US NOW or call 888-469-3486