How Business Valuation Disputes Can Impact Divorce Settlements

Dividing a business in a Maryland divorce can quickly become one of the most challenging parts of the process. Without forethought and careful action, this conflict can delay the divorce and add emotional and financial stress.

Why Business Valuation Becomes a Problem

When a couple owns or holds an interest in a privately held company, deciding how much that business is worth can open the door to major disagreements. In high-asset divorces, a business may be the most valuable marital asset. Whether the business is jointly owned or controlled by one spouse, both people usually have a stake in the outcome.

Problems start when each side presents different numbers. For example, one spouse may claim the business is worth less to reduce what they have to share, while the other may argue it’s worth more to increase their share of the total assets.

The value of a business depends on various factors, including revenue, debts, future growth, customer base, and even the industry. Disputes often arise over how much income the business really produces, how stable it is, and whether it includes goodwill — the business’s reputation or the owner’s personal influence.

Ways to Deal with Valuation Conflicts

A couple can start by using an independent expert to perform a full valuation. In many cases, courts rely on professionals who specialize in private company appraisals. This helps reduce bias and keeps the focus on facts.

Both sides should also gather all relevant financial documents, including tax returns, profit and loss statements, and balance sheets. The more transparent the records, the fewer surprises during the process.

Another smart step is agreeing in advance on the method of valuation. Will it depend on earnings, assets, or market comparisons? Picking a method ahead of time can limit future arguments.

High-value divorces demand careful planning, especially when they involve businesses. Disputes over value can lead to long delays and bigger expenses. Taking steps to reduce conflict early can help protect one’s finances and the health of the business.

Bottom Line: In a Maryland divorce, disputes over the value of a business can cause significant delays and costs, making early agreement on valuation methods and transparent financial records essential to protect both assets and the business’s future.