Pesce Law Group, P.C.

FREE CONSULTATIONS 630-352-2240

Naperville | Oak Brook | Burr Ridge | Lake Forest | St. Charles

Business Valuation Attorneys in Glen Ellyn

DuPage County Business Valuation Lawyers

Businesses do not have price tags. Moreover, the statistics in a balance sheet can sometimes be deceptive; for example, a particular accounts-receivable balance may be, essentially, uncollectable. Further complicating matters, all businesses have intangible assets, most notably customer and supplier goodwill. The best way to value businesses, for divorce purposes, is to take a measured approach that relies on established methods.

At Pesce Law Group, P.C., we routinely handle business valuation and property division matters. Although every case is different, we rely on proven techniques that have been developed and refined through many years of practice. Our goal is to craft an equitable property division that upholds your legal and financial interests, both in the short and long term.

Factors to Consider

Ever since it was released in 1959, IRS Revenue Ruling 59-60 has been the leading authority on this subject, and Illinois courts have consistently upheld both its specific findings and general principles. To value a business, for divorce purposes, the examiner should consider:

  • The type and nature of the business, beginning with its inception date,
  • Company's maximum earning capacity,
  • Stock's actual market value,
  • Business' current financial condition,
  • Overall economic outlook in general, and the industry's outlook in particular,
  • Value of comparable stocks being traded on the open market
  • Stock sales and number of shares,
  • Dividend capacity, and
  • Any intangible assets, including business goodwill.

The Ruling stresses that each valuation is fact-specific, and the prongs should be given varying weight according to individual circumstances.

Overall Approaches

During the valuation, the appraiser may use one of three overall models, in addition to the specific questions in Revenue Ruling 59-60:

  • Market Approach, which uses comparable sales as a guideline,
  • Asset Approach, which considers only the enterprise's tangible and intangible assets, or
  • Income Approach, which gives great weight to the company's actual and potential income.

Choosing a Valuator

Not all accountants are necessarily qualified to conduct a business valuation, especially where small or medium-sized businesses are concerned. The American Institute for Certified Public Accountants requires that a CPA complete additional training to be an Accredited Business Valuator. That training includes, at a minimum, a completed apprenticeship program, a written exam, and additional annual continuing education hours. Pesce Law Group, P.C. attorneys network with professionals in other disciplines, so we are an excellent resource to locate qualified appraisers.

A proper and accurate business valuation is an integral part of a divorce property settlement. For a free consultation with experienced family law attorneys, contact Pesce Law Group, P.C. at 630-352-2240. Convenient payment plans are available.

Related News

Read More
How to Protect Yourself Financially When Divorcing Someone with Addiction Issues
How to Protect Yourself Financially When Divorcing Someone with Addiction IssuesAccording to government data, approximately 23.5 million Americans have drug and alcohol addictions.  That works out to roughly one in 10 individuals in the United States over the age of 12. Alcoholism and drug addiction can rob a person of everything they hold dear in...
Child Support Nonpayment in Illinois
Child Support Nonpayment in IllinoisThe purpose of child support is to help a child of unmarried or divorced parents enjoy the same quality of life as they would if their parents were together. If a noncustodial parent does not pay his or her court-ordered child support, the custodial parent...
Differentiating Between Martial and Separate Property During an Illinois Divorce
Differentiating Between Martial and Separate Property During an Illinois DivorceOne of the most challenging aspects of a divorce can often be determining how property will be divided. Illinois law dictates that only marital, or shared, property should be divided during a divorce and that non-marital, or separate, property is not. However, it can be...
Back to Top