More Alimony Reform: Valuation of Professional Practices in Divorce Proceedings
More Alimony Reform: Valuation of Professional Practices in Divorce Proceedings
By Rita Fuerst Adams, National Executive Director, Fathers and Families
March 29, 2013
The Massachusetts Medical Society has submitted an act relative to the valuation of professional practices in divorce proceedings, H1227. This legislation is applicable to all professional practices – medical, architectural, legal, financial services, and engineering.
Prior to 1997, the Massachusetts probate courts in divorce proceedings treated the value of a corporation as the price at which the property would change hands between a willing seller and a willing buyer, neither being under any compulsion to buy or sell and both having relevant knowledge of relevant facts. This definition is referred to as the fair market valuation standard as defined by the Internal Revenue Service. This legislation would reinstate this definition for professional corporations, in particular when the professional is going to stay with the corporation and continue to provide services.
Representative Michael D. Brady, D-Brockton, is sponsoring the legislation. It reads: