Divorce and your medical practice

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On Behalf of | Sep 24, 2021 | Divorce |

Any divorce can have its challenges. However, if it involves significant assets and a business, the property division aspect can be complex. For Colorado physicians who have their own medical practice or are part of a physician’s group, there will be inevitable financial concerns, especially when it comes to dividing the practice’s value in the divorce.

Issues to consider with a medical practice in a divorce

Doctors must be cognizant of how their practice and career will be impacted financially by divorce. The following will be assessed: what kind of practice it is; it’s funding; whether it became established before the marriage or while the marriage was in progress; if it is a group practice with shares allocated; and what the future financial obligations are. As with any business, it is not all profit. There are payouts like medical malpractice insurance, office expenses, staffing, loans, and more. The entire practice should be scrutinized to determine its value. That might mean that there is a need for forensic accounting.

A partner in medical practice will want to retain as much as possible in the divorce settlement. The other partners will need to be informed about the legal process since certain states do not allow non-physicians to own medical practice. There could even be a legal agreement that the divorcing physician’s share of the practice is forfeited because of the divorce. Depending on the practice, if there is a specific specialty, its size, and what the finances are, the case might boil down to a dispute between accountants and those whose analysis is deemed more accurate.

Physicians should be prepared for every eventuality in a divorce

The division of the practice and its valuation are just two parts of a physician’s divorce that should be considered in the case. Since a large amount of money is at stake with this type of situation, it is imperative to know the ramifications from the start. Having assistance from experienced professionals is vital.

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