During a divorce, a financial statement may list your income, debts and major assets. But if you own part of a medical practice, law firm or other professional business, a statement may not accurately show what your share is worth. That can make an already stressful divorce harder to sort out.
Illinois treats a professional license differently from a share of a business. The court may need more information to decide what belongs to the marriage and what value to place on it.
What Illinois treats as marital property
Illinois courts do not treat your professional degree or license as marital property. Your medical or law license, for example, does not become an asset that the court divides in divorce.
A share of a practice is different. Illinois generally treats property you gain during the marriage as marital property unless an exception applies. The court then considers that property when dividing the marital estate.
A financial statement may list your share without showing the rights that come with it. A partnership agreement could limit when you can sell your interest or what happens if you leave the practice. Those terms may help explain why the number on the form gives only part of the picture.
Looking at the business more closely
An experienced legal counsel may review your partnership agreement and business records to see what your share includes. Those papers could explain how the practice pays you or what happens if you leave.
Your counsel can also work with a financial professional to find out what the business is worth. That review helps separate the value of the business from income tied to your future work. It could also show whether the amount on your financial statement needs more explanation.
Gather the records that matter
Consider keeping your partnership agreement and recent business records in one place. Tax returns may also show how the practice earns income and pays you. These documents could help you understand your share of the business more clearly. As you get ready for the divorce process, organized records may help you identify which assets need more review.