What Happens to Family Owned Businesses or Private Practices in Divorce?
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What Happens to Family Owned Businesses or Private Practices in Divorce?
Physicians, dentists, lawyers, CPAs, architects and other private practice professionals in Arizona should seriously consider retaining legal advice when evaluating or pursuing divorce.
Licensed professionals with substantial assets can place their business, future earning potential and financial security in jeopardy when ending a marriage without adequate consideration, planning and protection strategies.
A Professional Practice is a Community Asset
Under Arizona law, a working professional’s business or practice is frequently deemed a “community asset” subject to ownership claims invoked by the opposing spouse. When the practice was launched and how it has performed financially during the marriage, will be key issues examined by the family court in evaluating any property settlement or spousal support award. Extraordinary evidence is typically required to completely take control of your private practice without any payment to your spouse for its present value. However, that is not to say that other strategies and tactics cannot be relied upon to advance your case in the most compelling light to maximize and protect what is rightfully yours during marital dissolution.
Considerations include:
- Whether the business was formed before marriage or after
- If one spouse supported the other through medical school or graduate school
- Whether one spouse put a career on hold to support the other in building his or her practice
- Trended earnings and capitalization of the practice over the past 12, 36 or 60 months
- Complex Evaluations of the Business are Key
Private practice evaluations are material components of divorce litigation and unguided professionals often resist providing the financial information needed for an accurate evaluation.
The firm frequently brings in proven business valuation specialists, forensic accountants and third party investigators to help safeguard clients’ financial interests whether they are owners, or the spouse of an owner, of a business or professional practice.
Choose Attorneys With Business Acumen
Whether you own, or are married to an owner of family business, a medical doctor practice, alternative medicine practice, specialized physician, dentist, lawyer, attorney partnership, group practice, clinical practice, affiliated licensee, general or limited partnership, our firm is uniquely positioned to navigate you through the pre-filing strategy, evaluation, valuation and allocation during the marriage dissolution process
Contact us today to schedule your initial case review. We’re here to help!