Business Valuation News

Building Value Newsletter Volume X, Issue III

A Business Valuation Newsletter for Business Owners and the Professionals Who Advise Them

Top Five Issues When Valuing a Small Business for Divorce

Valuing a business for divorce has a variety of complexities not present for other valuation purposes. In this article we’ll discuss what we believe are five of the most important issues.

1. STANDARD OF VALUE
In all tax business valuations and many other “non-divorce” valuations, the standard of value utilized is fair market value which is defined in the International Business Valuation Glossary as “the price at which property would change hands between a hypothetical willing and able buyer and a hypothetical willing and able seller, acting at arm’s length in an open and unrestricted market, when neither is under compulsion to buy or sell and both have reasonable knowledge of the relevant facts.”

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