Professional Practices and Licenses in Divorce: Enterprise vs. Personal Goodwill, Valuation Methods, and More

Valuing a professional practice is difficult and costly because of the subjective nature of professional (legal, medical, dental, accounting, architectural or engineering) practices. Valuations for professional practices operate differently than a typical business valuation.

Goodwill is an essential factor in determining a practice's value. Enterprise and personal goodwill are critical factors, but only enterprise goodwill is transferable to a spouse in a divorce. Family law practitioners must understand elements that constitute enterprise vs. personal goodwill and identify and procure an expert business appraiser to perform this analysis.

Not only is a professional practice the most valuable asset in many marital estates, but its value is also often dependent on a spouse's personality, skill and reputation. The divorce attorney must understand the issues and documentation relevant to valuing the practice and secure discovery to prepare and bolster an expert's financial analysis.

Listen as our distinguished panel guides family law practitioners on valuing and dividing a professional practice or license in a divorce. The panelists will discuss enterprise vs. personal goodwill, the role of an expert business appraiser, tax implications, and more.

1. Overview of challenges in valuing professional practices in divorce
2. Enterprise vs. personal goodwill
3. Role of expert business appraiser
4. Documents needed to value a professional practice
5. Treatment of professional licenses in divorce

The panel will review these and other relevant topics:

• What are the unique challenges in valuing a professional practice in divorce?
• How can enterprise goodwill be analyzed and valued separately from personal goodwill?
• How are professional licenses treated in divorce?
• What documents are necessary to value a professional practice?