Kevin Qualls Family Law
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How to estimate the value of the family business

Orange County, California, couples are frequently more than just household partners; they often own and manage a family business together as well. While sometimes these businesses operate more as a side job which generates a little extra income, in many cases, the family business is the source of the couple's livelihood and, in addition, is the couple's most valuable marital asset.

It's not always easy to put a value on one's business. Even if they are owned in combination with other friends and relatives, family businesses are rarely if ever large enough to put on the public market, meaning they don't have widely available certificates of stock with established prices.

Moreover, businesses are unique enough such that there is no guidebook to tell a person how to value, for example, a family-owned restaurant.

The best way to get a value on one's business is to sell it, although of course that is not always what people want to do. When a critical life event like a divorce or a death in the family happens, however, it may be necessary to get some idea of how much a business is worth, as the business will have to be accounted for or divided in some way.

If one is going to court, hiring a business evaluator is probably the best way to go, even if it does cost money. However, there are ways a person can estimate the value of his or her business. The most basic step is to count up what the business owns and owes; however, to get an accurate value, one must also find some way to translate the stream of income a business generates in to a lump sum sale price.

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Kevin Qualls Family Law
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