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How to value a business for divorce purposes

Nevada residents who work with their spouses may face unique challenges in the event of a divorce. For some, the business represents their largest and most valuable asset. Therefore, it is worth knowing how much the company could get on the open market. It is also a good idea to know how much debt that it may have or if there are other liabilities to consider.

Those who jointly own a company with a former spouse may be entitled to a buyout. The amount of the buyout depends on how much the company is valued at among other factors. Determining the value of a business may require hiring an objective outside party instead of a business owner making an educated guess.

The entity doing the appraisal should take into consideration the value of a company's brand name. Furthermore, it should project potential revenue growth over the next several years based on revenues in the current year. Hiring an outside party to create a valuation may avoid scenarios where a spouse may try to hide profits or otherwise tamp down the company's true value. This is generally done to reduce the amount that the other person receives in a settlement.

Going through the property division process may be arduous for those who own a business. However, working with an attorney may make it easier to complete that process in a favorable manner. Legal counsel may be able to use knowledge of state law to increase the odds that a person gets what he or she is entitled to.

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