When a doctors divorce, there are unique issues that arise that have to be dealt with such as how to deal with the value of the professional license, the ownership of a business entity operated by the professionally, the valuation of a business, and the student loans associated with obtaining the professional license. For a doctor going through a divorce, these could all be aspects of marital property that have to be carefully considered in the division of the marital estate.
5 Areas of Concern for a Doctor Getting a Divorce
There are five key areas of concern for a doctor facing divorce.
1. Medical Practice Valuation
Valuing a medical practice is complicated but very important in determining how to divide the marital property equitably. If the medical practice was starting during the marriage, then it is likely that the marital practice will be considered marital property. If the medical practice is marital property, then it has to be divided equitably. Keep in mind that Illinois law requires that the marital estate be divided “equitably” which does not necessarily mean “equally” it could mean equal, but the requirement is equitable and there are several factors that a court will look at to determine this equity in the division of marital property.
Use a Business Valuation Expert
It is important to retain a business evaluation expert with experience valuing medical practices. Once you retain such an expert you can work with that expert in providing the appropriate information and access to get a professional valuation that will hold up in court. Valuing a medical practice has many components and is not as simple as a review of tax returns, profit and loss statements, or balance sheets. Valuation of a doctor’s medical practice is often based on intangible things such as reputation, goodwill and longevity in the community. Both parties to the divorce have an interest in making sure that the medical practice does not suffer financially during a divorce due to cash flow but also maintains its reputation, patients, and goodwill.
2. Dividing Marital Debts
The marital estate must also include the marital debt so it is important to include all marital debt in the calculation when dividing marital property. Debt associated with a medical practice will be calculated in the expert valuation. Keeping in mind that in Illinois student loan debt is largely considered a personal debt belonging to the person accruing the debt. You may have gone to medical school during the marriage and those loans were used to obtain a professional license that benefited the marriage, however, as a general rule student loan debt is not the responsibility of your spouse.
3. Spousal Support Issues
If you attended medical school during the marriage and your spouse supported the family during this time, that is an important factor that the Judge would take into consideration when it comes to property division and support. On the other hand, if you had your professional license when you got married and your spouse gave up a career to stay home and care for the household and children while you opened your medical practice and advanced your career, the court’s will not hold this against your spouse but will use this as a relevant factor in determining property division and support.
4. Equitable Division of Marital Property
There are many ways to structure the equitable division of property which may or may not include maintenance or alimony once you have the valuation of the medical practice. It is often recommended that you work with a mediator or each other to work out a solution that fits your family as opposed to having a judge decide. The Judge may not necessarily have a handle on what is best for your family and it is certainly recommended to resolve these types of issues with the help of your attorney or mediator to save time, costs, as well as many other stressors involved in litigation.
5. Custody and Parenting Responsibilities
The other issue for doctors going through a divorce is the schedules that are required to practice medicine. This is not a Monday — Friday job and when you have on-call time and other responsibilities it can be a challenge figuring out how to share time with the children and develop a parenting schedule. Again, this is something that is best worked out between divorcing spouses with the help of their lawyers or a mediator, as you know your children and family best and you also know what is best for your children. You can ask a stranger in a black robe to make these types of decisions for you but you are giving them an awful lot of power over your family and how your life will move forward.
In Illinois, the term “custody” — when one parent is the custodial parent and the other visits with the children — is no longer used. Instead, the terms “Parenting Time” and “Allocation of Decision Making” are used when children are involved. This makes things flexible enough for you to work out a solution for parenting time that fits within your work schedule that may change every week and the children’s schedule which is also likely to be fluid. There are many creative ways to come up with a long-term schedule that fits your unique family situation. There is no one boilerplate plan that works for everyone.
Seek Advice from a Divorce Attorney Experienced Representing Doctors
If you are a doctor about to go through a divorce, please contact us to talk about some creative solutions to move your life forward with grace and integrity for your entire family. With decades of experience representing physicians and other professionals throughout the Chicago area, Anderson & Boback is ready to put our expertise to work for you.
THIS ARTICLE WAS PREVIOUSLY PUBLISHED AT: https://illinoislawforyou.com/divorce/issues-when-doctors-divorce/