Business Valuation During Divorce Attorney in Red Bank Guides Clients Through the Complexities of Dealing with Business Interests During Equitable Distribution in Monmouth County, Ocean County, Middlesex County, and Throughout NJ
Divorces can become highly complex when one or both spouses own business interests. Because state law usually ownership interests in the marital estate, a divorcing couple must divide the value of business interests as they would any other marital asset. Resolving the equitable division of business interests requires obtaining a company valuation. Our firm's New Jersey business valuation lawyer can help guide you through the process. Our experienced, top-rated family law group has the resources and skills to ensure you receive your fair share of your or your spouse’s business interests in divorce.
Contact Joseph J. Russell Divorce & Family Law Attorney, for an initial consultation to learn more about what a business valuation during divorce attorney in Red Bank can do to help you protect your financial future. Turn to our firm for help with the complex issues in dealing with business interests during the division of marital assets.
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What Happens to Business Ownership Interests During Divorce?
New Jersey law requires an equitable division of business ownership interests acquired during the marriage or the growth in value of such interests during the marriage. Couples negotiating equitable division or a court can handle business ownership interests in several ways. First, courts may split ownership interests between spouses, including corporation shares or LLC units. However, transferring business ownership interests may run afoul of the company’s governing agreements. In those cases, the court may grant the non-owner spouse a larger share of the remaining marital estate to account for the portion of the business interest that the spouse should have received. Finally, a spouse may agree to a buyout of their ownership interest, with the proceeds of the buyout or sale split between the couple.
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How to Value a Business During Divorce
Dividing business interests in divorce requires assigning a value to the business or calculating the growth in value of the company during the marriage. Couples have several options for conducting a business valuation. First, a couple may jointly hire a valuation expert and agree to adopt the expert’s valuation. Alternatively, each spouse may employ a separate expert to provide a valuation that the spouse may use during settlement negotiations or litigation. Hiring an independent expert also enables each spouse to discuss litigation strategy with their expert.
Whether spouses hire a joint expert or separate experts, a business evaluator will consider various financial information from the company, including:
- Tax returns
- Bank and credit card statements
- Certificates of incorporation/formation
- Bylaws, operating agreements, and shareholder agreements
- Financial projections
- Invoices and accounts receivable
- Payroll
- Equity cap tables
Depending on the type of business, valuation experts will require specific documents to begin their analysis and often have supplemental requests for additional information as they dig through the business’s finances.
Valuation experts may also ask for the owner spouse’s cashflow valuation to determine how much the spouse earns from the business since their tax returns may not necessarily reflect their owner’s compensation. For example, a spouse may receive additional benefits listed as business expenses, such as a company car. Cashflow valuations also help in cases where a spouse agrees to sell or accept a buyout of their ownership interest.
Couples should work with business valuation experts who have experience evaluating businesses in the divorce context, as those experts will have familiarity with valuing businesses for equitable distribution or splitting premarital and marital components of business value growth.
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Turn to a New Jersey Business Valuation Lawyer from Our Firm to Help You Protect Your Financial Interests and Hard Work
Dealing with business ownership interests in a divorce can be one of the most complicated issues a separating couple can face. You need an experienced business valuation during divorce attorney in Red Bank to advocate for your rights and financial interests. When you turn to us for help if you or your spouse has a business, you can expect our firm to:
- Gather financial records and information from the business
- Review the business’s charter and operating agreements
- Retain experienced business valuation experts or advise you if you and your spouse want to hire a joint evaluator
- Discuss your legal rights and options with you and prepare you for the business valuation process
- Review the expert’s valuation with you
- Explore options for handling the business interests in your divorce, including splitting shares or offsetting your spouse’s share with other marital assets during equitable division
Contact Joseph J. Russell Divorce & Family Law Attorney, for a Case Evaluation to Learn More About How a Business Valuation During Divorce Attorney in Red Bank Can Assist You
Don’t risk your financial interests when equitably dividing your marital estate during divorce if you or your spouse owns a business. Contact our firm for a confidential case review with a New Jersey business valuation lawyer to learn more about how we can guide you through addressing business ownership interests in your divorce.