Goodwill is one of the most confusing aspects of valuing a business interest for divorce cases. In many states, goodwill needs to be valued and then divided into two pieces: business and personal goodwill. Unfortunately, significant differences in methods and theories exist on this complex issue, as recent case law demonstrates. Key definitions According to the International Valuation Glossary — Business Valuation, “Goodwill can arise as a result of name, reputation, customer loyalty, location, products, and similar factors not separately identified.” A business interest may possess two types of goodwill: Business (or entity) goodwill. This belongs strictly to the entity itself. Business goodwill may arise from many sources, including the company’s name, phone number, location and special attributes, such as special menu items or recipes at...