The McCarthy Law Firm is here to help you navigate this unprecedented financial insecurity in a cost effective way with any family law concerns you may have. Our full service family law firm offers customized and reduced cost options such as legal coaching, limited scope representation and a broad range of fee options suitable for most budgets. At this time, we are also offering free one hour telephone consultations for any medical professionals, first responders, law enforcement and military personnel. Please call us at (520) 623-0341 to explore your options. Click here to learn more about how we are following protocols from the county and CDC in order to better assist you.

Small Business Valuations During the COVID-19 Crisis

the next few months may be financially devastating to many businesses, especially small ones. What happens if you are going through a divorce and the value of your business is an issue? What happens if you already are divorced and are paying your ex for their share of a business that was awarded to you? Is there any recourse?

If you are divorcing or planning a divorce, the virus could substantially reduce or even eliminate the value of your business. 

This is because a business value depends in large part on being able to predict with reasonable certainty how much you will earn in the future. The business valuation expert predicts this based on your past earnings. Past earnings may now be meaningless. That doesn’t mean you can’t settle your divorce if the two of you disagree over the value. 

One option would be to defer the issue to the Court to decide several months after the divorce decree has been entered in order to let the markets settle down a bit. 

Another option would be to divide a percentage of profits in the future after paying the business owner a reasonable wage for their service. However, these options require careful consideration and should not be attempted as DIY.

If you are already divorced and stuck with paying for a business that no longer has value, your options are far more limited. If you are in this position, don’t just give up. Consider getting at least a consultation with an attorney to determine if there is any recourse.

Stay tuned for more information about the effect of this virus on vital family law issues.

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