When you file for a divorce in Ohio, you will need to equitably divide your marital assets with your former partner. Although that task may appear straightforward, certain financial interests can be difficult to assess and make the overall settlement more complex. Knowing which items present a challenge can help you prepare for what the process may involve.
Valuing private business interests
A closely held company does not have a public market price, so a financial professional may need to estimate the value of your ownership interest. The review includes:
- Financial statements and reported cash flow over recent years
- Business debts and the owner’s compensation drawn from earnings
- Goodwill, meaning the value tied to reputation rather than physical assets
- The income, asset and market approaches, each of which produces a different estimate
The timing and method of acquisition partly determine how the court classifies the ownership interest. If one spouse owned the company before the marriage, the original interest and traceable passive appreciation may remain separate, while either spouse’s labor, money or other contributions can generate marital growth.
Calculating deferred retirement benefits
Retirement benefits may include both marital and separate property because they can build before, during and after the marriage. For a pension, a coverture fraction might compare the years of service during the marriage with the employee’s total service.
Because payments may not begin for years, the valuation also considers taxes and the plan’s payment terms. A qualified domestic relations order can divide many private employer plans, while Ohio public employee plans use a division of property order to pay the former spouse an assigned share.
Appraising specialized property
Some property is difficult to value because there is no single market price to rely on. For commercial buildings, rental units and farms, an appraiser may consider recent sales, income, lease terms and zoning limits to reach a reasonable estimate.
The analysis changes for assets whose worth depends more on demand or future earnings. Artwork, jewelry and collectibles can turn on condition, authenticity and ownership history, while cryptocurrency and intellectual property requires careful timing because prices or expected income can change quickly.
Reconciling conflicting expert opinions
Experts can reach different values for the same asset because they may use separate methods, dates or records. A clear report should explain how the expert reached the estimate and identify the documents that support it.
If the difference remains, each side can challenge the assumptions behind the other opinion. You and your former partner can also agree to use a mediator to narrow the dispute and make settlement easier.
