Determining the Value of a Business When Ending a Marriage

Whether a company was brought into the marriage by one spouse or built together during the relationship, business valuation is key to a fair divorce settlement. Divorce is rarely simple, but when one or both spouses own a business, the process becomes even more complex. To achieve a fair outcome during divorce involving business ownership, connect with an Orlando family lawyer.

How Businesses Are Valued

In Florida, marital property is divided through a process known as equitable distribution. This doesn’t always mean a 50/50 split, but it does mean that assets acquired during the marriage are divided fairly. If a business is considered marital property (or even partially marital property) its value must be carefully assessed to determine how it fits into the overall division of assets.

Without a clear and accurate valuation, one spouse may walk away with far more than the other, which can create disputes and prolong the divorce process.

Business valuation typically involves professional analysis. Experts typically look at:

• Assets and liabilities. What the business owns and owes.
• Earnings history. Revenue, profits, and growth trends.
• Market value. What a similar business might sell for in the current market.
• Goodwill and reputation. Less tangible factors that still add value.

This thorough evaluation provides a foundation for negotiations and ensures both parties understand the worth of the business.

Brought Into the Marriage vs. Built Together

If one spouse owned the business before the marriage, part of it may still be considered separate property. But any increase in value during the marriage might be classified as marital property. On the other hand, if both spouses built the company together, its entire value is typically included in the marital estate.

This distinction is important and often requires expert analysis to determine what portion of the business is subject to division. Once the value of the business is determined, the next step is deciding how to handle it.  Several options are available. If one spouse is more involved in the business, they may want to buy out the other’s share, allowing the business to continue without disruption. Or, should neither spouse want to continue ownership, selling may be the cleanest option. Co-ownership is another option, though this requires a high level of cooperation.

An experienced Orlando family lawyer can work with financial experts, guide negotiations, and help you pursue an outcome that allows both parties to move forward. Business valuation in divorce is a sensitive and detailed process. Emotions often run high, but with skilled legal guidance, it’s possible to reach a resolution that is fair and protects your financial future. Facing divorce when a business is part of the equation can be thorny, but professional support is available.

Should you hire someone to evaluate your family business? When leaving a marriage, talk to the family law attorneys at Donna Hung Law. With the right strategy, you can ensure the business is valued properly and that any settlement is both fair and addresses your long-term interests. Call 407-999-0099 or contact the office online.