Valuing a Business During a Divorce

Even when both parties agree that it is time to dissolve a marriage, dividing assets in a divorce can be challenging. Valuing assets like real estate, vehicles, and retirement accounts, is fairly straightforward, as they all have a market value. When it comes to valuing a business, however, things can get tricky.
The accurate valuation of a business during a divorce is often complex and requires the counsel of experienced business lawyers.

Understanding the Valuation Process

Whether it is large or small, every business has value. Attempting to value your business yourself can be a losing proposition. Even if you do seek the services of a highly experienced divorce lawyer in PA, it is important to understand how the valuation process works.

Separate vs. Marital Assets

First, the determination of whether a business interest is separate or marital must be made. Generally, if a business was started or acquired during a marriage, it is considered marital property and should be divided equally. If one spouse owned it before marriage or it was created with separate funds, it could be considered separate property, not a marital asset. However, just because the business interest was acquired prior to the date of marriage, it does not mean that the non-owner spouse is not entitled to a portion of it. Each situation is unique, and it is vital to have a knowledgeable attorney to protect your rights and interests.

Ways to Value a Business

There are three approaches that may be used when determining the value of a business interest, including :

Asset approach: This approach calculates a value using a fairly straightforward equation: assets minus liabilities = value.  Both tangible and intangible assets are included in this approach. Tangible assets may include cash, inventory, real property, and other concrete assets. Intangible assets may include trademarks, patents, and other intellectual property, accounts receivable, and other assets. Although this approach may appear straightforward, it can actually be complex, depending on various factors, including the type of inventory and unrecorded assets and liabilities, which can create significant issues.

Market approach: Using this approach, the value of a business is compared to similar businesses that have been sold in the same geographical area, much like appraisers look at comparables in a neighborhood when determining the value of a home. However, profitability can vary greatly from one business to another and this approach can be challenging when no similar businesses have recently been sold.

Income approach: The most common type of approach that is used to determine the value of a business is the income approach. It uses specific formulas and historical information to determine projected cash flow and profits, and also takes into consideration future benefits and the rate of risk or return.

Unless the business is very small, all of these approaches require legal or financial professionals to investigate and analyze the assets, liabilities, history, finances, and myriad aspects of the business to determine its true value. Business succession planning attorneys are often skilled at this task, as they are quite familiar with the various ways that business may be accurately valued.

At Carosella & Associates, our divorce attorneys and business lawyers in West Chester work collaboratively to guide clients through the valuation process and protect their interests.

This blog was originally posted at https://carosella.com/valuing-a-business-during-a-divorce/

How to Modify a Child Support Order in PA

In Pennsylvania, both parents are required to support their children until the age of 18, sometimes even longer. However, financial circumstances change and child support orders can be modified to reflect those changes. Whether you are looking to increase or decrease a child support payment, it is best to contact an experienced attorney who can help you through the process and ensure your rights and interest are protected.

Circumstances that Warrant a Child Support Modification

Before modifying any child support order, the court will want proof of what has changed since the previous award was granted. There are some general factors that a court takes into consideration when setting a child support order, including

• How much time each parent spends with the child
• All income sources for each parent
• Both parents’ assets
• Household expenses, needs and fixed financial obligations (such as a mortgage)
• The children’s ages and any special financial needs they may have
• Other relevant factors (determined on a case-by-case basis)

When seeking a child support modification, you must present evidence that one or more of these factors has changed or a new relevant factor has come to light. Regardless of the circumstances, it is critical to seek legal counsel to ensure the modification is fair. For example, if you are filing for bankruptcy, it would be a good idea to consult a local bankruptcy lawyer who understands the ins and outs of bankruptcy law in Pennsylvania. Most full-service law firms in West Chester have attorneys who work collaboratively to develop solutions in complex cases, even if they focus on different areas of the law.

Common Grounds for Modifying a Child Support Order

• The parent who pays child support is spending more time caring for the child
• The parent receiving child support is earning more money
• The parent who pays child support is earning less money than they did previously
• The child’s educational, medical or other needs have changed since the initial order was granted
• A child is over eighteen years old and is no longer attending school
• Birth or adoption of another child

It is important to keep in mind that an award may be modified in the other parent’s favor if they present stronger arguments and evidence in response to your petition.

Seeking a Child Support Modification

Desired changes to a support order cannot be applied before you submit a petition for modification with the Domestic Relations Section (DRS) in your county. Once a completed Petition for Modification form is received, the DRS will schedule a conference and send both parties a notice indicating date, time and location to review the facts of the case and discuss the modification. Even if both parents are in agreement, they are required to submit a modification order with DRS. Parents who are incarcerated may appear by phone.

The financial repercussions of a modified child support order can be far-reaching. A divorce attorney can advise you on the most effective course of action and develop strategies that serve your interests and desired outcome.

Do you need assistance with modifying a child support order? Our family law attorneys at Carosella & Associates can help.

This blog was originally posted at https://carosella.com/how-to-modify-a-child-support-order-in-pa/

When can Grandparents Seek Custody of a Grandchild? (recent bill expanded custody rights)

Grandparents often play a vital role in children’s lives, and may step in when a parent is unable to care for their children on their own. In Pennsylvania, courts always consider the best interests of a child when determining custody. It is unfortunate but due to the opioid epidemic, more grandparents have assumed the role of caregiver for their grandchildren. In 2018, the Pennsylvania legislature passed a bill that addresses several issues surrounding child custody, including and expansion of who can file for custody of a child and clarification of the circumstances in which grandparents can seek custody of a grandchild. As with all other child custody matters, courts look to determine “the best interests of the child”.

Grandparents’ Custody Rights

The new law works to resolve the issues raised by a 2016 Pennsylvania Supreme Court ruling that limited the ability of grandparents to seek custody of their grandchildren. It also opens the door for other third parties such as friends, neighbors, or other relatives to file for legal custody. Whether you are a grandparent or another party who is seeking custody of a child, it is essential to seek the counsel experienced family law attorneys who understand how the system works.

Grandparents may file for custody of a child under the following circumstances:

• Upon the death of one or both parents
• Grandparents can seek full or partial custody or visitation if a custody action has already been initiated by either parent, unless both parents believe that contact with the grandparent is not in the best interest of the child.
• The child began their relationship with the grandparents with the consent of the parents or through a court order
• If a grandparent has been acting as a child’s parent, also known as “in loco parentis,” they can file for custody of the child. Under the new law, other third parties who have been acting in loco parentis may file as well.
• Grandparents can also seek custody if there are issues of neglect, abuse, or drug and alcohol dependency.
• If a child has lived with a grandparent for 12 months or more
• When a child’s biological parents cannot be located

If you currently have custody or are seeking custody of a child, it is also a good idea to consult wills and trusts lawyers  or estate planning attorneys for advice about how to protect the child’s interests should something happen to you.

The Court’s Role in Determining Custody

Although keeping children with their biological parents is considered ideal, if this is not possible a court will try to determine which type of arrangement will best serve the child. Courts consider the following factors before awarding visitation or custody:

• The child’s emotional and physical well-being
• The past and current relationship between the child and their grandparents
• If the child is older, the court will ask what their preference is
• The potential influence on a child’s social and intellectual growth

Legal issues surrounding custody and visitation can be complex. If you are a grandparent interested in filing for legal custody of a child, the experienced attorneys at our law firm in West Chester can help.

This blog was originally posted at https://carosella.com/when-can-grandparents-seek-custody-of-a-grandchild/