Over the years, you and your spouse may have acquired various assets that you believe hold significant value. During your marriage, you may have simply appreciated the aesthetic these brought to your household decor or the income you earned from a business, but now that you are getting a divorce, you may worry about how your property will be divided.
If you do not have a prenuptial agreement, most assets that you and your spouse obtained during your marriage will count as marital property. As a result, some of your antiques, artwork and other valuable property could end up divided between the two of you. Because you undoubtedly want a fair outcome, determining the values of those assets is vital.
How are assets valued?
The manner in which valuation occurs can depend on the type of assets involved. For instance, when looking at your personal property, a cost approach could work that would involve simply looking at the cost needed to replace the item. This method typically works best for everyday items. If you have an asset that could increase in value, such as a piece of artwork, a revenue approach may be best, which would involve an appraiser determining the possibility of the asset generating future revenue.
If you or your spouse owns a business, valuation could take place differently. The assets and debts of the company may need assessing as well as the company’s profits. It may also prove important to determine whether the company’s value has increased or decreased because that information could affect the outcome of property division.
You may also need to determine the value of your home and any other real estate that you own. Real estate appraisers typically consider the fair market value of any real property using comparative market analysis. Appreciation and depreciation of the property may also play a part in the valuation as well as any home improvements that you may have made over the years.
Why is value important?
Because Colorado is an equitable division state, the court will attempt to divide the marital assets as fairly as possible. When immensely valuable, rare or unusual items are involved, understanding the values of the assets could ensure that the division is equitable. If you have questions or concerns regarding the property division aspects of your case, you may want to consult with a family law attorney.