A company that you, your spouse or both of you own, like any other marital asset, is subject to division in the divorce settlement. If the business is considered marital property, determining its value is the next step.  Value may be based on historical  income generation, future ability to generate income, assets held, or liquidation value.   Not all businesses are valued using the same method.

Because establishing the value of a business is incredibly complex, and varies from state to state, the best practice is typically to have a formal business valuation be completed by a Certified Valuation Analyst or other accredited business valuation expert.

Here are 10 documents habitually requested in business valuations:

• Articles of Incorporation and/or other formation documents showing the date of establishment or acquisition of the business (corporation, LLC, sole proprietorship, partnership, S corporation, etc.)

• Operating Agreement, Buy-Sell Agreement or other documents and agreement detailing terms of ownership, sale and transfer.

• Shareholders agreements, if applicable, along with a list of shareholders, how many shares owned by each, and class of shares

• Organizational chart

• Financial statements (including Profit and Loss statements, Balance Sheets, Budgets, etc.) for the previous 3 to 5 years

• Corporate tax returns and any notices of assessment for the previous 3 to 5 years

• Previous valuations of the business, offers of sale, purchase or transfer documents for all members or partners for the previous 5 to 10 years

• Bank statements, credit card statements, and loan statements for the previous 3 to 5 years

• Real estate and equipment appraisals, and also business vehicle valuations

• Life insurance policy statements the corporation either owns or is named as beneficiary

With a combined 30 years in family law, the attorneys at Jones Family Law Group, LLC, are highly experienced in working with business owners going through divorce. We can provide the legal guidance you need.