Division Of Corporate Assets

division of corporate assets

Division Of Corporate Assets

division of corporate assets

When you’re in the middle of a divorce, it’s important to understand how the division of corporate assets works. While you may believe you own your business alone, the law says otherwise. Businesses can be joint marital property and included in the property division process.

Understanding How To Value A Business

To determine the value of a business, its assets, intangible property, and liabilities must be reviewed.

Tangible property may include equipment, in-stock inventory, office equipment, and even buildings and other real estate associated with the business.

The cash in any business bank account counts in this valuation too.

Liabilities include rent, equipment leases, regular payments for services such as accounting, drop shipping, etc, loans, and credit lines.

What Are the Standards For Valuation?

There are three common standards that can be used in valuation during the division of corporate assets:

Income-based

This calculates the net income of the business and the expected net income in the future.

Asset-based

This approach is best for a business that must be liquidated. The value of the assets, when sold on the open market, is added together to come up with a business value.

Market-based

Many consider this the fairest valuation approach; this compares similar businesses that are up for sale. The calculated value can be adjusted based on the results of the other two methods accordingly.

What Do Courts Consider When Dividing A Business?

After an appraiser has determined the value of the business, the court may consider many factors, including:

  • If the business existed before being married.
  • The percentage owned by each partner (if applicable).
  • How involved each person was with the business.
  • The value each spouse brings to the business, whether qualifications, training, or working relationships.
  • If one spouse borrowed money for the business.
  • If one person can buy out the other.
  • How they are dividing other assets and liabilities.
  • If each person could earn a similar wage without the business.

Schedule A Consultation to Discuss Dividing a Business

It can be difficult to understand, measure, value, and divide a business in the State of Florida. Hiring a business law attorney from Xander Law Group that can guide you through this complex legal process will ensure that you get the results you deserve.

Our attorneys represent clients throughout Miami-Dade, Broward, and Palm Beach Counties, we work diligently to ensure that you get the most accurate valuation for your business and guide you through this challenging legal process.

To schedule a consultation to learn more about our business law services including division of corporate assets, call our Miami office at 305-767-2001.