Divorce is usually not a simple and easy process. Even if there are no children, the couple still needs to sort out the division of their assets. This process can be even more complicated when a couple has significant assets. Whether you and your spouse own a business, properties, offshore bank accounts, 401(k) accounts, investments, stock options, or other types of investments, we know that the stakes are high when you decide to go your separate ways.
A high asset or high net worth divorce is typically defined as a divorce that involves more than one million dollars in net liquid assets. Like most individuals who are going through a divorce, you might be worried about how much you will end up with when all is said and done. You may be wondering what you do not know as you go into divorce proceedings with all of your assets. By hiring a divorce attorney to stand up for your legal rights, you can be assured that everything possible will be done to get you what you deserve. Here are some factors that you should be aware of that can complicate your divorce because of your assets.
Identifying and Categorizing
In many high-asset divorce cases, it is difficult to determine and valuate the assets that belong to the couple. In most marriages, the assets owned before the marriage are considered the property of the individual; however, when asset appreciation is involved, this may not be the case. If the couple has previously signed a prenuptial agreement, this will make the process easier. High asset divorces usually involve one or more of the following:
- Small businesses
- Professional firms
- Real estate holdings
- Investment portfolios
No matter what a couple has, each spouse must disclose all of their assets within the divorce proceedings. When a divorce is contentious and high-value items are up for grabs, some people go as far as trying to hide assets. They may even try to transfer money or property to friends or relatives and try to hide them from them.
However, doing so will only make your divorce more complicated. More often than not, people who attempt to do so in a high asset divorce will be discovered, leading to serious legal consequences.
During a divorce, it is crucial to know the value of all assets that the couple owns together in order to ensure a fair division of property. When a couple owns significant assets of high value, it can be complicated to determine their value and what it means to each spouse. When many assets or assets of high values are involved, in addition to a knowledgeable divorce lawyer, it is also wise to enlist the help of a forensic accountant or other financial professionals. These experts can help ascertain the value of a business, debts, accounts receivable, and annual statements. They can also provide special evaluations for:
- Retirement accounts
- Intellectual property
- Complicated Assets such as Advanced Degrees
Once your divorce is final, your tax filing status will change. This could be enough of a change to impact your tax liability significantly.
When dividing high-value assets, many couples do not consider the inherent tax concerns. If one spouse ends up receiving certain assets in the divorce, they may be taxed on the distribution. Spousal maintenance and support, benefit plans, and businesses can also impact the taxes one spouse might owe. By working with financial advisors and your divorce lawyer, you can help reduce your tax liability as much as possible in your divorce.
Length of the Divorce Process
Since high-asset divorces are more complicated, and they often take longer than your average divorce. Many couples seeking a divorce fail to stop to consider this factor. It can take months or more to find and evaluate all assets in a divorce where there are many. For this reason, some couples prefer to settle outside of court to reduce the amount of time a divorce will take. Even if you decide not to settle out of court, having the right divorce attorney and other professionals on your side will help ensure that no matter how long your divorce takes, it was worth it in the end.
Spousal and Child Support
In high asset divorces, spousal and child support is usually higher. It can be more difficult for a couple to reach an agreement regarding these types of support. If left up to the court, it can take longer for orders to be reached since there are likely more factors to consider than in a basic divorce. If either spouse earned a degree or was a homemaker at any time during the marriage, these factors will impact spousal support, also known as alimony.
Whether one of the spouses is a national or local celebrity or just wants to be extremely private, it can be difficult to keep a high-asset divorce private. If one or both of the spouses have high profile careers (such as athlete or entertainer), business concern or if privacy is of extreme importance to either spouse, they may want to consider mediation to resolve their differences and divide their assets. It is also essential to use a divorce attorney who will enforce privacy protection matters to ensure no information about your divorce is leaked.
Get the Most Out of Your Divorce with Help from a Divorce Attorney
Do not let these complicating factors of high asset divorces get in your way when it comes to moving toward the life that you envision. Your property and the complex division of assets should not stop you from leaving a marriage you believe is over, nor should it keep you frozen in fear. No matter how complex you feel your divorce or certain assets may be, our divorce attorneys are here to help. Please schedule a consultation by reaching out to an agent or by scheduling online.