Readers may recall our last post, in which we discussed how a small business is often part of the marital property in a divorce, even when only one spouse was involved in the business.
Today, we continue our discussion of how a business owned by a spouse can affect the divorce process. Specifically, our post today is about how the value of the company is calculated for marital property purposes.
Like anything else in the pile of marital assets, it is necessary to have an accurate valuation of the business. This is so that, if one spouse wants to be bought out of his or her equitable share, the two sides will know exactly what that share is.
Just how that value is reached depends on your particular circumstances, such as the sort of company you or your spouse owns. However, there are certain methods that are acceptable under Virginia law. Often, your attorney will hire an expert to do it, as will your spouse’s lawyer. Or the spouses can hire a single expert, if they are cordial enough to accept a “neutral” expert’s opinion. In some cases, a rough estimate provided by the expert, which takes less time and costs less, may be sufficient.
Once a valuation of the business is reached, the spouses can decide what to do with it. It is possible that the spouse who owns the company can trade other assets that equal the other spouse’s share. Or cash can be exchanged. Having a good attorney on your side can help ensure that you get what you're entitled to.
Source: Richmond Times Dispatch, “Business owners and divorce,” Christopher H. Macturk, Feb. 3, 2014