August 27, 2025
Family law is often complicated and when a divorce is pending or in process, it becomes even more complex when the divorcing couple has one or more business. If you have questions about your divorce or business, our Austin, TX family law lawyer team is available to discuss your situation and answer your questions. We take pride in our accessibility, client service, cost-effective legal solutions—and when necessary, our skills to fiercely fight your legal battles for you in court.
When a couple owns a business, either together or individually, figuring out the business’s value is a critical part of the divorce process. That value affects how property is divided and can significantly influence the financial outcome for both parties. Whether the business is large or small, determining an accurate valuation is essential to avoid an unfair result.
Texas is a community property state, meaning assets and debts acquired during the marriage are generally considered jointly owned. A business created during the marriage is usually community property, even if only one spouse actively worked in it. In some cases, a business started before marriage can still have community interest if marital funds or effort were used to grow or maintain it. That makes business valuation a key step in dividing property fairly.
There are several approaches used to determine the value of a business during divorce. Each method offers a different perspective based on the business’s structure, income, and market position:
The right method depends on the nature of the business and available financial data. Valuation often involves working with accountants or other financial professionals who review tax returns, financial statements, and other business records.
To value a business accurately, documentation is key. This includes tax filings, balance sheets, profit and loss statements, and any ownership agreements. These documents help clarify how the business operates, how profitable it is, and what share of the business is subject to division.
If one spouse believes the other is hiding income or undervaluing the business, forensic accounting may be necessary. This can help uncover discrepancies and give the court a clearer picture of the true value of the business.
It’s not unusual for each spouse to have a different opinion of what the business is worth. In these situations, both sides may present independent valuations to the court. If an agreement cannot be reached, the court will decide how to divide the business interest based on the evidence presented.
Once you have figured out the value of your business and whether or not it is considered communal property, if you are planning to divorce or are in the midst of one, it is also a good idea to look into fixing your estate plan.
If you have questions or need help with a divorce, child custody, estate planning, property division, child support, mediation, or business law matters, contact Gray Becker, P.C. today.
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