Closely Held Businesses

Divorce and Closely Held Businesses in Pennsylvania

In a divorce case, the existence of a closely held business can complicate matters and make the divorce settlement more difficult to resolve. Understanding how to resolve these issues requires an attorney with the ability to evaluate the business in question, including reviewing financial statements and other business records. Most lawyers can understand basic tax returns, but they usually have to hire accountants or other financial experts to review and evaluate more complicated financial information.

At the law firm of Iwanyshyn & Associates, Attorney Iwanyshyn is able to do much of the forensic accounting that your case will require without having to hire outside experts. Although she cannot testify as a business appraiser while acting as your attorney, she can control the case better by understanding what is going on instead of relying on accountants to explain principles of business valuation and forensic accounting.

As a Certified Public Accountant (CPA) and a former Senior Member of the American Society of Appraisers specializing in business valuation, family law attorney Deborah Luteran Iwanyshyn understands how to look at financial records and how to look for important information that is relevant to the economic issues related to the divorce proceedings. Ms. Iwanyshyn was the chief accountant for the Allegheny County Controller's Office and, prior to founding the firm, worked with an international "Big Eight" accounting firm in the area of forensic accounting and auditing.

Handling Closely Held Businesses in a Divorce

Any type of business or professional practice can complicate matters in a divorce, including retail outlets, restaurants, physician practices, family-owned businesses and more. While every business has its own individual needs and requirements, there are three main options when working with a closely-held business during a divorce:

• Business ownership will remain between both parties in the divorce: Sometimes, it may be possible to continue a working relationship even when the marriage is ending. If both parties can keep the business relationship and personal relationship separate, this option may be desirable. In many cases, however, continued ownership after a divorce will lead to more problems and disputes in the future.
• The business will be sold and the profits will be divided:
  This option of selling the business and dividing the profits allows both parties in the divorce to gain something from the sale without having to work with their ex-spouse. Sometimes, however, it can be difficult to sell the business, and, in most cases, one spouse has been the primary operator of the business. During this period between the divorce and the sale of the business, the business must still be run by one or both of the individuals, which can cause significant problems and disputes.
• One spouse will retain ownership of the business and will offset its value with other assets:
  This option is usually the preferable option for a closely held business in a divorce. In order for this option to work, however, there must be a way of purchasing the value of the interest from the other spouse. This can be accomplished by trading assets such as equity in a home, IRAs or 401(k) plans, securities and cash equivalents or making installment payments.

If you and your spouse own a closely held business in Allison Park, North Hills, Pittsburgh, Allegheny, Beaver, Westmoreland or Washington County or the surrounding communities of Pennsylvania, contact us at the law firm of Iwanyshyn & Associates. Call us at 412-487-1576 or toll free at 877-345-0210 to schedule a consultation to discuss your case.