A divorce or marital dissolution matter needs an economist when a closely held business or professional practice must be valued, when a self-employed spouse's income for support purposes differs from the reported compensation, when separate and marital property must be traced through commingled accounts, or when a lifestyle analysis is needed to support or contest a support claim. Counsel considering an economist should gather the business records and the personal financial statements first, because the valuation, the income determination, and the tracing all start from them.
Checklist
Gather the business's financial statements, tax returns, and general ledger detail for several years
Assemble the parties' personal tax returns, bank and brokerage statements, and loan applications
Identify the valuation date the governing framework requires and whether personal goodwill is treated separately
Document owner compensation, personal expenses run through the business, and distributions
Note whether tracing of separate property or a lifestyle analysis is needed in addition to the valuation
Questions to ask the economist
How do you determine the income available for support from a business beyond the owner's reported compensation?
How do you address personal and enterprise goodwill when the framework requires the distinction?
What records do you need to trace separate property through commingled accounts?
Can you provide a preliminary value range for mediation before the full engagement?
Timeline
Two to three weeks to a preliminary value and income view from the business and personal records. The full report follows the retention and records phases.
Required documents
Business financial statements, tax returns, and general ledger detail
Personal tax returns, bank, brokerage, and retirement account statements
Loan applications and personal financial statements submitted to lenders
Documents bearing on the acquisition of assets claimed as separate property
Common pitfalls
Accepting the owner spouse's reported compensation as income for support without analyzing the business's cash flow
Valuing the business as of the wrong date for the framework that governs the division
Waiting to request the general ledger, which is the record that reveals personal expenses paid by the business
Does every divorce with a business interest need a valuation?
Not always, but most contested ones do. Where the parties agree on value or the interest is minor relative to the estate, a valuation may not be worth its cost. Where the business is the largest marital asset, where one spouse controls its records, or where income for support is in dispute, an independent valuation and income analysis usually decides the outcome.
Can one economist be retained jointly by both spouses?
Yes, where counsel and the court agree. A joint neutral engagement produces one valuation and income analysis both sides can examine, which often reduces cost and narrows the dispute to specific adjustments. The engagement letter states that the economist reports to both parties and applies the same method regardless of who retained the expert.
How long does a business valuation in a divorce take?
A preliminary value range can follow within weeks of receiving the financial statements and tax returns. The full valuation depends on the general ledger detail, the owner compensation records, and the personal financial statements, and on whether tracing or a lifestyle analysis is also in scope. The records request, not the arithmetic, sets the schedule.
References
American Institute of Certified Public Accountants. (n.d.). Statement on Standards for Valuation Services (VS Section 100). AICPA & CIMA. Retrieved August 27, 2026. aicpa-cima.com
National Association of Certified Valuators and Analysts. (n.d.). NACVA professional standards and ethics. Retrieved August 27, 2026. nacva.com
U.S. Bureau of Labor Statistics. (n.d.). Occupational Employment and Wage Statistics (OEWS). U.S. Department of Labor. bls.gov