Business Appraisal For Marital Dissolution

Need a business valuation for your divorce?

It is common for the spouse that isn't involved in the day-to-day business operations to think that the business is worth more than the spouse running the operating company believes it is. Unfortunately, most family law judges have little expertise or experience in business valuation. The easy explanation is that your business or your partial ownership interest is worth what a buyer will pay for it - but in many divorce cases, the answers might not be straight-forward.

For purposes of a business valuation related to marital dissolution in the State of Texas, the value of an asset is its fair market value unless it has no fair market value. Fair Market Value, (the standard of value for Texas divorces) means the amount that would be paid in cash by a willing buyer who desires to buy, but is not required to buy, to a willing seller who desires to sell, but is under no necessity of selling.

In performing the valuation, it may be necessary to distinguish between corporate goodwill (that which is inherent in the business itself and would be transferable in a sale) and personal goodwill (that which is attributable to an individual's skills, abilities and reputation - Texas PJC 203.1 and PJC 203.2). In Texas, the portion of value attributed to corporate goodwill is included as part of the marital estate and the portion attributed to personal goodwill is excluded from the marital estate. The separation of corporate and personal goodwill can significantly affect the value of a business for marital dissolution.

Why choose Convergent Capital Appraisers?

In the event that you are involved in a pending divorce that involves business ownership, our professionals have the experience, skill and attention to detail to determine applicable regulations, the valuation approaches and methods that are best suited to your specific circumstances; and the understanding of how to bring all the relevant factors together to develop an accurate and defensible value conclusion.