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Valuation of Businesses During a Divorce

One of the most difficult tasks in a divorce can be placing a value on a family-owned business, and then determining how to divide its value equitably between the spouses. This can be one of the most contentious and complex issues before the court in a Georgia divorce, simply because the process can involve so much uncertainty, and because the business may be the biggest asset that the parties own.

There are different ways to measure the value of a business, including fair market value, fair value, investment value, and intrinsic value. Furthermore, there is a distinction between the material or tangible value of the business, or its physical building, cash, inventory, and fixtures, and the intangible value of the business, which is often referred to as goodwill, including customer lists, community reputation, and branding. Additionally, there may be a distinction made between personal goodwill, which arguably should not be a marital asset as it is particular to the owner of the business, and professional goodwill, which is more likely to be a marital asset in that it belongs to the business itself.

Either spouse may very well need the expertise of a business valuation expert, who can help evaluate the business under current economic conditions and place a value on the business. This expert also can help determine how much of the value of the business is attributable to personal goodwill, as opposed to professional goodwill or tangible assets. This determination can assist the court in making a decision about dividing the business equitably, if the parties cannot agree.

Contact us or call today to learn how Shaw Law can work with you to achieve the best outcome possible for you and your children.

Scott Shaw is founder and principle of Shaw Law Firm LLC, founded in 1995 and dedicated solely to divorce, family law and child custody matters that must be addressed and decided in the state of Georgia. Shaw Law Firm serves the greater Metro Atlanta area, particularly the counties of Fulton, Gwinnett, Cobb, Cherokee, Forsyth, Paulding, Henry, Fayette, Coweta, Newton, Walton, Bartow and Douglas. Schedule a consultation today at 770-594-8309.