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Getting Divorced As A Business Owner Or The Spouse Of A Business Owner

When a business owner goes through a divorce, the division of assets between the parties can get infinitely more complicated. At Gill Law Group, PC, our Orange County divorce lawyers have over 80 combined years of experience between them. They have the knowledge, skills and resources to handle the complicated issues that arise when a business needs to be analyzed and assessed as part of the property division process during a divorce.

Is A Business Considered Community Property?

In the state of California, when a couple gets divorced, their assets are designated as either community property or separate property. Any of their marital assets that are deemed to be community property must be divided equally. If the business was created during the marriage, then it will most likely be deemed community property, and each spouse could be granted 50% of the ownership interests in the business. If the business was operating before the marriage, then determining its value as community property is more complicated. But, if the value of the business increased over the course of the marriage, then each spouse would be entitled to half of the increase in the value of the business.

How To Place A Value On A Business In California

Before the value of the business can be divided, the business must be evaluated to determine its value. In a contested divorce, there are three different options that a divorce court in California might use to determine the value of a business as part of the asset division for a divorce in California:

  1. An income approach, which anticipates the future profits or cash flow of the company to calculate the company’s value
  2. A market approach, which values the business based on a sample of recent comparable sales of similar businesses in the same geographic region
  3. An asset approach, which values the business based on its assets, unsold inventory and real estate

Whether you are a business owner or the divorcing spouse of a business owner, our experienced team of divorce attorneys can help make sure that your rights and ownership interest in a marital business are protected and that the marital assets are divided fairly. Even if your divorce is amicable and you are working toward a settlement in an uncontested divorce, you will still need to have an accurate assessment for the value of the business. With access to trusted financial experts, our Orange County divorce lawyers can handle the complex tax of evaluating marital assets when they include a small business.

Does Your Divorce Involve A Small Business? Call Our Orange County Divorce Attorneys Today.

Our Orange County divorce lawyers offer a free initial consultation appointment. You can schedule your free consultation by calling our office at 949-868-5268 or sending us an email through our website.