New Jersey Business Evaluations And Division
While going through a divorce, one complex situation is the evaluation and division of a business. Whether this business if family owned, a privately held company or a professional practice such as a law or medical office, the New Jersey Law Office of Joanna D. Brick, Esq. understands the complexity of evaluating and dividing businesses during a divorce in New Jersey. Determining the value of a business can be extremely intricate and a number of professionals may need to be brought in to assist with valuation. Joanna D. Brick, Esq. has widespread experience working with these necessary professionals, while ensuring her client’s satisfaction of the outcome.
Evaluating A Business In New Jersey
It is not uncommon for a divorce in Northern NJ to include a business that must be evaluated and divided between the two parties involved. There are three sets of ways to evaluate a business allowed in the NJ courts. These include a market method, a cost approach method and an income or capitalized method. Our family law firm in New Jersey has the experience to understand the different methods of evaluating a business and strategically determine which of these methods will result in the best outcome for our client. When a business is evaluated for the purposes of division during a divorce, there are a number of factors that must be taken into consideration that are different from when a business value is established for sale. Whether the business is a professional practice or a privately held business, such as a restaurant or services company, it is important to determine which method of valuation will result in the most positive impact for our client. If a business happens to be a publically traded company, determining the value of the stock on the open market is extremely important to the divorce case. If a company is a large private practice, then each of the members of the firm or executives must be taken into consideration and how the division will impact each of them. If there are other partners, it is also significant to determine how this evaluation and division will affect the other partners of the business.
New Jersey Marital Division Of Business
The first part of this intricate asset distribution will be the evaluation of the business. Once the method of valuation has been determined and presented to the Court, the Court will determine how this asset is to be divided in the distribution scheme of all of the parties’ marital assets. Division of a business will not only depend on the value but depend upon what each party is seeking in their divorce. Determining your interest in a business as it relates to the other assets of marriage is important and our experienced NJ law firm will talk to you about your options and outcomes.
Seek Legal Assistance For Business Evaluation & Division
The Law Office of Joanna D. Brick, Esq. has extensive experience in marital business evaluations and division of business assets in New Jersey, offering quality, personalized, and professional legal services out of its central office in Fair Lawn, New Jersey. We service Northern and Central New Jersey in Bergen, Essex, Hudson, Middlesex, Morris, Passaic, & Union Counties.
Stay Informed
Our Best Attorneys
Contact The
Brick Law Firm
We represent and mediate for clients of all asset levels, including high net worth individuals. To learn more about how we can help you, call the Brick Law, LLC, in Bergen County, New Jersey, at 201-254-0881
Frequently Asked Questions
Common questions about business evaluations & division in New Jersey, answered by Brick Law, LLC.
Is my business marital property in a New Jersey divorce?
If the business was started during the marriage it is generally marital property. If it predates the marriage, the increase in value during the marriage is usually subject to equitable distribution, particularly where that growth came from a spouse’s active efforts rather than passive market forces.
How is a business valued in a New Jersey divorce?
A valuation expert applies recognised approaches — income, market and asset-based — then selects or weights them for the type of business. The expert normalises owner compensation and discretionary expenses to establish true earning capacity, and values the interest as of an agreed date.
Are minority or marketability discounts applied?
In New Jersey matrimonial matters, generally no. Following Brown v. Brown, courts value a business interest at fair value to the owning spouse rather than fair market value, so discounts for lack of marketability or for a minority interest are typically not applied against the non-owner spouse.
What is goodwill and is it divisible?
Enterprise goodwill — value attaching to the business itself and transferable to a buyer — is divisible. Personal goodwill, which depends on an individual’s own reputation and skill and cannot be sold, is treated differently. Separating the two is often the central dispute in valuing a professional practice.
Will I have to sell my business?
Usually not. The common outcome is that the owner retains the business and the other spouse is compensated through other assets or a structured buyout over time. A forced sale is a last resort where there are insufficient other assets to balance the distribution.
Can we use one joint expert instead of two?
Yes, and it is often the cost-effective choice. A jointly retained neutral appraiser produces a single report both sides rely on, avoiding duelling valuations. It requires agreement in advance on the expert, the scope, the valuation date and how the fee is shared.
Have a question that is not answered here? Contact Brick Law, LLC or call (201) 254-0881 to speak with a Bergen County family law attorney.
This information is general and about New Jersey law. It is not legal advice and does not create an attorney-client relationship. Every case turns on its own facts.