How do the courts deal with a closely-held business or professional practices?
Like any other asset, a business or professional practice must be considered in the valuation and division of community property. To the extent that a business or practice has been developed during the marriage, there is a community property interest that must be dealt with in the dissolution. The most difficult and time-consuming aspect in determining the value of a business or professional practice is in evaluation of “goodwill.” This is the intangible value that most businesses have, which is based on the expectation of future business, based on established name or reputation. If the business or practice is operated by one of the spouses, it still has a goodwill value, even if it could not be sold on the open market. Certified public accountant and business appraisers are hired to determine the value of a business or professional practice. The accountant or appraiser who is hired reviews the books and records of the business or practice and prepares a written report.
