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3 assets that can be difficult to value in a Maryland divorce

On Behalf of | Dec 13, 2023 | Division of Property

Divorce is a time of emotional upheaval and financial uncertainty. Unless a couple already has a marital agreement, there can be a lot of conflict related to the division of their resources as they prepare for divorce. Many couples would prefer to retain control over the process. They can achieve this goal by negotiating their own custody matters and property division settlements.

To reasonably divide marital property, divorcing couples in Maryland need to identify their shared or marital resources and then put a reasonable fair market value on those assets. The following resources can be much harder than others to properly value in a Maryland divorce.

The marital home

The value of real property changes drastically from year to year. Couples sometimes assume they know what the home is worth because they know what they paid for the property. However, the longer it has been since they acquired their home, the greater the chances that the sale price is not an accurate reflection of the current fair market value for the home. People may need to bring in a real estate professional to look at the property and establish what it is likely currently worth.

A marital business or professional practice

A business often requires major investments during a marriage, as one spouse may give up their earning potential and spend hours of their time trying to establish a new business. Not only does a business typically have resources that are worth money, but they also represent a source of future income for divorcing spouses. There are many different ways to value a business, and spouses may have a hard time agreeing on the right valuation approach and final value for the business.

Invested resources or deferred compensation

Couples may buy stocks and other investments together with the intention of retaining those resources for years or even decades. They may then need to divide those investments during a divorce. Even if specific stock holdings do have a set value, it can be difficult to address investments in a divorce when people expect those resources to appreciate substantially in the future. Especially if there are future investment opportunities granted as part of someone’s employment compensation, such as restricted stock options, there may not be a clear value to apply toward investment holdings and deferred income.

Spouses generally need to agree with one another about what their property is worth before they can agree on how to share those resources with one another as they separate their lives. Seeking legal guidance when handling contentious matters during the Maryland divorce may help people obtain the best outcome while incurring minimal stress.