Unleashing the Power of Multi-Attribute Utility for Personal Goodwill Analysis

TLDR: In the sale of a C Corporation in an asset deal, personal goodwill may be used to reduce double taxation. However, in the context of a divorce, personal goodwill may not be considered a divisible asset. The determination of personal goodwill can be complicated, but it is important to consider factors such as the reputation and earning power of the professional/business owner, the age and health of the owner, the location of the business, and the types of clients/customers. To determine the value of personal goodwill, an analyst may utilize the multi-attribute utility model (MUM), which assigns weights to different attributes that contribute to personal and enterprise goodwill. The MUM analysis allows for a determination of the percentage of overall goodwill value that is allocable to personal goodwill.