Butler Business Valuations Lawyer
Because Pennsylvania is an equitable distribution state, when a married couple gets divorced, all of their marital assets are divided equitably, or “fairly.” Assets include bank accounts, real estate, cars, retirement accounts, stocks and bonds, and, of course, business assets. While a business may not be divided equally, such as being split down the middle 50/50, it will be divided fairly in the eyes of the court if the couple cannot come to an agreement on their own through negotiation or mediation. As such, business owners enter divorce rightfully worried that all of their hard work and sacrifice will be divided up by a judge who does not know any better. What will happen to the success of their business if ownership gets divided? What will happen to their employees if the business has to be sold off? After all, small businesses employ roughly half of the private sector workforce in America, according to the SBA Office of Advocacy.
On the other hand, a spouse who supported the business-owning spouse by homemaking, child raising, financially supporting their spouse while the business got off the ground, or sacrificing and contributing in their own way may also enter divorce worried that they will be unfairly cut out from the fair division of marital assets when a business is involved. Regardless of what side you are on, or if the business was owned and operated jointly by both spouses, you need to work with a Butler business valuations lawyer to ensure that your interests are protected.
Why Business Valuation is Crucial
Many households have 80 percent or more of their private assets tied up in their small business, according to Forbes. As such, this is often where the bulk of the marital assets are held, unlike non-business owner households where the majority of their assets are in the family home, mutual funds, or a retirement account. In order to determine what the business is worth, it must be professionally evaluated by an experienced attorney.
What is Considered Marital Assets, and the Three Types of Business Valuations
Only marital assets—property and debt accrued during the course of the marriage—count toward marital property. As such, if the business was owned by one of the spouses before the marriage, it is not necessarily considered marital property, and will not be divided. However, if the business grew during the marriage as a result of the other spouse’s contributions, including homemaking, taking out loans, supporting their spouse to get an MBA, or other means, the business could and likely will be considered a marital asset. The three types of business valuations include an asset-based approach, the income approach, and the market approach.
Call a Butler Business Valuation Lawyer
Here at the Law offices of Bunde & Roberts, P.C., our business valuation attorneys have more than 100 years of combined experience dealing with all types of family law and division of business asset matters in Pennsylvania. Reach us today at 412-391-4330 to schedule a consultation with a skilled Butler business valuation lawyer.