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Chicago Business Valuation Attorney
Reliable Divorce Lawyer for Division of Business Assets in Chicago, Illinois
The stakes of a divorce can be especially high for business owners, especially when it comes to the division of marital property. Not only does a business often have significant value, but it can also serve as a person's livelihood and primary source of income. A successful business can also symbolize many years of hard work and personal investment, and the threat of losing it in a divorce can be deeply concerning.
If you have business assets that may be subject to division in your divorce, you need an attorney who can help you understand your options. At The Law Offices of George J. Skuros, we have decades of experience representing Chicago area clients in divorces involving complex financial situations. When we represent you, we strive to provide you with a realistic prognosis so that you know what to expect throughout the divorce process, and to keep you fully informed as we help you work toward a resolution that protects your interests.
When is a Business Considered a Marital Asset?
Under Illinois law, assets acquired by either spouse during a marriage are typically considered marital property and thus subject to division in the event of a divorce. This means that a business could qualify as a marital asset if it was a new venture started by one or both spouses while they were married, or if it was an existing business purchased by one or both spouses during the marriage. It is not necessary for both spouses to play an active role in business operations in order for a business to be considered marital property.
On the other hand, there are plenty of situations in which businesses are not considered to be part of the marital estate. For example, if you founded or acquired your business before getting married, it may remain your own separate property. The same may be true if you were careful to invest only your own, non-marital assets in a business during your marriage, or if you became a business owner through an inheritance or gift. Keeping detailed records can help you demonstrate the non-marital nature of business assets and better protect them during your divorce.
Options for Valuing Your Business
During the divorce process, it is common for both spouses to obtain a valuation of any relevant business assets to provide information and leverage that can be used in property division negotiations. We can work in conjunction with knowledgeable financial experts to help you obtain reasonable valuations using a variety of methods. If businesses similar to yours are frequently sold and acquired, or if you own shares of a business that are publicly traded, it may be possible to take a market value approach based on comparable transactions. Owners of smaller family businesses may be better served by a book value or liquidation value that considers the business's assets and liabilities, or an earning-based value that considers the income the business will generate in the future.
Addressing Your Business in Property Division Negotiations
In order to retain the greatest control over what happens to your business assets in the divorce, your best option is usually to try to negotiate a fair distribution with your spouse. You may be able to keep your business in the divorce if you can buy out your spouse's share with other marital assets, like your home or assets held in financial accounts, that have a value roughly equal to the value of the business. If keeping your business results in a skewed distribution, you could agree to provide your spouse with regular maintenance payments. Depending on your relationship with your spouse, you could reach an agreement in which you both continue to own a portion of the business, perhaps even acting as business partners after your marriage ends. As with many other marital assets, selling a business is also an option that can simplify the property division process.
Business Valuation FAQs
The cost of a business valuation often depends on the scope of the business. On the low end, a proper business valuation may cost a few thousand dollars. For larger, more complex companies, however, a valuation may cost upwards of $20,000. Our firm can discuss pricing with you based on the unique circumstances of your case.
If you need a business valuation, you should turn to a professional who has specific experience in appraising companies. While a CPA can handle a business valuation, you should make sure that they have the relevant qualifications and training to get an accurate estimate. Our lawyers can help you network with the right financial experts to ensure that your business valuation will be performed correctly.
An accurate valuation can provide you with critical information during property division so that you can negotiate with greater clarity. If your business is over- or undervalued, it could lead to disputes or a less favorable distribution of assets.
The length of a business valuation can vary depending on the complexity of the company. For smaller businesses, the process could be completed in a few weeks. On the other hand, it may take several weeks to months to estimate the value of a larger company.
There are three generally accepted methods of valuing businesses in an Illinois divorce. The first method involves comparing the recent sales of similarly sized businesses to estimate a business’s value. The second method involves totaling a business’s assets and liabilities to gauge its worth. The third method involves looking at the business’s present and future potential to generate revenue. Depending on your case, a combination of different valuation methods may be appropriate.
In Illinois, the divorce courts prioritize fair and equitable outcomes to property division disputes. The value of a business will be considered when determining the full extent of a couple’s assets. When dividing a business and other assets, the court may consider each spouse’s contributions to the value of a business–among other factors–to determine how business interests should be allocated.
Although CPAs are well-versed in financial issues, they may not be specifically trained in handling business valuations during divorce cases. On the other hand, a lawyer has the unique skillset required to work with the right financial professionals and estimate the value of a business in a divorce.
If you disagree with a business valuation, you can question its accuracy in divorce court. To dispute a valuation, you should come prepared with evidence showing that an error was made during the procedure, such as an overestimate of the cash flow. Our lawyer can represent you in a dispute over a business valuation, fighting to protect your interests.
No matter how small or large your company is, getting a proper valuation for your business is crucial. If your spouse contributed to the growth of your small business, they may be entitled to ownership of certain assets or reimbursement for their contributions. It is important to figure out exactly what your business is worth to ensure that your marital assets can be divided fairly and equitably.
When addressing concerns related to business interests during a divorce, you should entrust the valuation of your business to an experienced, financially literate law firm. At The Law Office of George J. Skuros, we have more than 30 years of legal experience, and we have helped many clients resolve complex financial issues involving private practices and family businesses.
Contact a Chicago, IL Business Property Division Lawyer
Properly valuing your business and preparing for the divorce process takes time, and we can help you get started as soon as possible. Contact us at 312-884-1222 today for a free consultation with our Chicago, IL divorce attorney. The Law Office of George J. Skuros serves business owners in Chicago and throughout Cook County and the surrounding areas.
Serving Counties Across Illinois
From our offices in Downtown Chicago & Park Ridge, we serve clients throughout Cook County, including the North Shore and the Northwest Suburbs of Schaumburg, Arlington Heights, Mount Prospect, Des Plaines, Inverness, and more. Our services also extend to surrounding areas in DuPage County, Lake County, Kane County, and Will County.
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312-884-1222
1580 N. Northwest Highway, Suite 12, Park Ridge, IL 60068
From our offices in Park Ridge and Chicago, we serve clients throughout the Chicagoland area, including but not limited to Cook County, DuPage County, Harwood Heights, Rosemont, Schaumburg, Des Plaines, Elmwood Park, Norridge, Schiller Park, Lincolnwood, Edgewater, River Grove, Austin, Niles, Morton Grove, Skokie, Norwood, Logan Square, Bucktown, Oak Park, Wheeling, Hoffman Estates, Rolling Meadows, Palatine, Cicero, Evanston, Northbrook, Mt. Prospect, Elmhurst, Glenview, Humboldt Park, and the Loop, as well as Naperville, Wheaton, Lombard, and Glen Ellyn.
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