What are some of the challenges of a divorce for a physician in Jefferson County or Louisville? A recent study noted one out of every three married doctors in the US will face a divorce. How will a divorce affect the physician’s practice?
Most divorces involving doctors will include many of the more typical issues surrounding child custody, child support and Maintenance.
The disposition of the practice of any physician or licensed professional will usually be a significant concern during marital property division. If the practice was begun or an interest in the practice was obtained during the course of the marriage, the doctor’s financial interest in the practice itself is considered to be marital property. Marital property is to be divided evenly between the parties in a divorce in Louisville.
One of the challenges of a divorce for a physician is “valuation.” The valuation of a doctor’s ownership position in their practice must be established before the Court. Most physicians belong to a group practice, partnership or some other form of entity.
Many questions regarding the nature of the entity, when it was established, existing stock or buy/sell agreements, as well as future vesting of the doctor’s ownership interest or other profit vehicle the doctor could be entitled to after the divorce must be evaluated.
In addition, the question of “Goodwill” must be assessed. Goodwill is an intangible asset and there are many factors which must be considered and added to the overall valuation of the practice or physician’s business interest. Generally speaking, Goodwill consists of the doctor’s reputation, as well as expectations surrounding the ability to maintain existing patients and obtain new ones in the future. This should also encompass the degree of experience, expertise, years of practice, specializations as well as the physician’s age, health and earnings capacity.
It is important to note divorcing spouses owe each other a fiduciary duty. Any effort to misrepresent the value of the practice as well as past, present or future earnings could be considered as fraud, resulting in substantial financial penalties and sanctions if not criminal liability.
Once the marital property interest in the practice has been established, another of the challenges of a divorce for a Physician is offsetting their spouse’s portion of the marital property interest in their practice/entity.
This is why it is important to work with the Divorce and family law attorneys at Dodd & Dodd. Our attorneys have decades of experience in these cases and provide sound advice and counsel regarding the challenges of a divorce for a physician or their spouse.
We invite you to review the strong recommendations of our former clients and contact us or call 502-584-1108 to schedule an appointment with one of our experienced divorce and family law attorneys.
