Divorcing business owners have a lot on the line, though their business, of course, is at the top of the list. Unfortunately, business owner divorce can be complex, partially because of the business valuation process. Please continue reading and reach out to our experienced California divorce attorneys to learn more about business valuations and how we can help you through every step of the process ahead. Here are some of the questions you may have:
How is business ownership determined in CA divorces?
If you are a business owner and are looking to divorce your spouse, it may seem abundantly clear that the business is your business, and that you, therefore, are entitled to keep your business. Unfortunately, there are multiple complicating factors that may push your business into more of a gray area. For instance, if you started your business during your marriage, California courts may consider it to be community property, and will therefore be equitably distributed. Furthermore, if your spouse contributed to the business, even indirectly, such as by foregoing his or her career goals in support of you following your dream, he or she may also be entitled to part of your business. That being said, if your business was started before your marriage or after the date of your separation, it should, under most circumstances, be considered separate property.
How are businesses valued in California?
If you are a divorcing business owner, California courts will have to assign a value to your business once they determine it is marital property. This is generally an exhaustive process wherein you will have to provide the courts with various financial documents regarding your business. If you do not completely or truthfully disclose all assets, you may be subject to investigation by the IRS, which can drastically complicate matters. Furthermore, forensic accountants and other parties may also be involved in the valuation of your business, which is why it is so critical you hire an experienced Los Angeles divorce attorney who can ensure you have everything you need to make the process move along as smoothly as possible.
What mistakes can be made when conducting business valuations in CA?
There are various mistakes that we see made throughout the business valuation process, and we are trained to constantly be on the lookout for such errors to ensure they do not happen. Some of the most common mistakes we see are as follows:
- Using an illegitimate valuation method that CA courts do not accept
- Failing to include all of your business assets and liabilities in the valuation
- Failing to take temporary business changes into account
- Neglecting to apply minority discounts
These are just some of the most common mistakes our firm sees fairly regularly. The bottom line is that when your business is at stake, we are here to help you rest assured that you, and your business, are in good hands.
Contact our experienced Los Angeles firm
Divorce and family law issues are notoriously complicated and personal, which is why you must hire an attorney with years of experience, as well as the compassion and skill needed to handle these sensitive matters. For the qualified, dedicated legal representation you and your family deserve and need, contact Zitser Family Law Group, APC today.
