Chicago Business/Property Valuation Lawyer

When a Chicago divorce case is underway, ensuring an accurate and fair valuation of businesses and properties are a crucial aspect to achieving an equitable settlement. Whether you are the business owner, property holder, or a spouse entitled to a share, understanding how valuations are conducted and the role they play in divorce proceedings can help protect your interests. Illinois is an equitable distribution state, which means that marital property is divided fairly, though not necessarily equally, in a divorce. To achieve this, the court must first determine the value of all marital assets. This includes, but is not limited to businesses, partnerships, corporations, houses, investment properties, commercial properties, vehicles, valuable collections, furniture and furnishings. Business and property valuations provide the foundation for dividing these assets between spouses. Whether it’s a closely-held business or a shared investment property, obtaining an accurate valuation ensures that both parties receive a fair share of the marital estate.

However, when one or both spouses own a business, determining its value can be particularly complex. Business valuation experts are typically brought in to analyze several factors, including revenue and profitability, assets and liabilities related to the business, industry conditions and goodwill. Depending on the nature of the business, valuation experts may use one of several methods to determine the fair market value. There is the income approach based upon the business’s ability to generate future income, the market approach to compare the business to similar companies that have been sold, or the asset-based approach to value the business by determining the tangible and intangible assets. Business valuations are often contentious in divorce proceedings, as both parties may have different views on the business’s worth. An expert, impartial valuation helps minimize disputes and ensures the court has a clear picture of what the business is truly worth.

For many couples, their home is their largest marital asset. In addition to the marital home, other properties such as vacation homes, rental properties, and commercial real estate may also need to be valued. A real estate appraisal is the most common method used to determine the fair market value of property. A professional appraiser will examine factors such as location, condition, comparable sales, and potential appreciation/depreciation. It’s important to have an up-to-date and accurate property valuation because real estate prices fluctuate, and an older appraisal might not reflect current market conditions.

To ensure fairness in the valuation of businesses and properties, both parties may hire independent experts such as forensic accountants, appraisers, or business valuation professionals. In some cases, the court may appoint its own neutral expert to conduct the valuation. Having an expert involved helps minimize disagreements and ensures a thorough examination of all financial aspects. This is especially important when one spouse is more familiar with the business or property in question, as it prevents them from potentially under-valuing or overvaluing assets to gain a financial advantage.