During the divorce process, a primary concern for both parties is the value of the marital estate. For physicians in Tennessee, this is especially critical. The value of a medical practice is not as cut-and-dried as say, the value of homes or automobiles. Therefore, an experienced attorney can help guide them through the process of valuing their medical practice.
Important factors during the process
When determining the value of a medical practice, you’ll have to ask a few basic questions. First, it’s important to know the legal structure of the business. Is it a sole proprietorship, legal partnership or limited liability corporation? The business entity will have a great deal to do with how things proceed. Most medical practices these days are group-owned entities, which means there are other investors involved.
It’s also important to determine whose money was used to start the business. A spouse who contributed materially in the beginning will have a much higher stake at the time of divorce. Furthermore, a business established after the marriage could be more vulnerable to property division.
Who can assist with the valuation?
It’s generally a good idea to hire a forensic accountant to assist you in the valuation of your practice. A forensic accountant who is experienced with this type of task can provide the most accurate estimate of the valuation of your asset.
In most jurisdictions, a spouse who is not a physician cannot just take over the practice. This is because non-physicians are prohibited from employing physicians or owning a medical practice.
Getting legal assistance
If a non-physician spouse cannot become an owner, both parties will have to come to a financial agreement based on the asset’s value to the marital estate. When exes cannot reach an agreement, it will be left up to the court to decide.
Even in amicable situations, divorce is complicated. An attorney can help you calmly and rationally evaluate your practice in preparation for your divorce.