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Methods for valuing common marital assets

| May 29, 2019 | Uncategorized

One of the most contentious aspects of a divorce is often the valuation of marital property. Once you categorize assets as either marital or separate property, it is time to determine the value of the assets before you decide how to split them. That said, you may not see eye to eye with your spouse on how much certain assets are worth.

If you and your spouse cannot agree on the value of assets, you may need to get appraisals. Here are some methods for valuing common marital assets. 

The family home

A standard strategy for figuring out the value of the home is to use comparative market analysis. This is a process that looks at recent listing and sale prices of comparable homes in the same neighborhood. However, there may be special factors to consider when valuing your home, such as unique features and home improvements. 

A business

If one or both of you own a business, then ownership may count as marital property. Valuing a business is a complex process that takes the following factors into account:

  • Business profits: Determining profits requires looking at income, expenses and employee salaries. 
  • Assets and debts: This includes both intangible properties such as patents and copyrights, as well as tangible property, such as inventory and equipment. Any money the business owes is also important to consider. 
  • Change in value: It is vital to analyze whether there is any increase or decrease in the value of the business since the beginning of the marriage.

Some professionals may value a business by determining what it can sell for on the market, while others may rely on bookkeeping and the depreciation or appreciation of assets.

Personal property

You may need to divide various types of personal property, such as vehicles, furniture and collectibles. Sometimes, it is enough to figure out how much replacing the property would cost. Other times, a market comparison method is necessary. Finally, a revenue approach may be ideal for investment pieces, such as artwork.

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