Assets in a divorce
In each and every divorce (even one where there is a prenuptial agreement) the assets of one or both parties are at risk. This means that either there is a risk you will lose the assets you spent years building or lose access to those assets necessary to help you maintain the lifestyle you experienced during marriage. In either case, you need to understand your rights and obligations in order to protect either the assets or access to them.
The assets in a divorce are made up of all of the real (house, land, etc.) and personal (furniture, knick-knacks, etc.) property which is part of the marital estate. The assets also include bank and retirement accounts and income streams. Quite often, it is the income stream which forms the most tangible asset of most marriages.
Income can either come from a person’s job or his or her business. In cases where there is a business at issue in the divorce, a correct valuation is central to understanding both the real value of the business and then determining the income that comes from it. Tennessee has an enormous small business community and many times that small business is at stake in a divorce.
The correct valuation of the business seeks to determine (1) expected future benefits and (2) risks relative to those future benefits. In determining this, the valuation takes into account issues such as the business’ income, ownership, debts, nature of the business and the value of any shares of stock.
Some of the standards for valuing a business include:
- Fair Market Value
- Fair Value
- Investment Value
- Intrinsic Value
- Book Value
Valuation is often determined by competing experts. Finding the right lawyer and working with the right experts is critical to either protecting your assets or protecting your access to those assets to protect your standard of living.