Divorce is a challenging experience for everyone involved. However, when couples have a high net worth, the consequences can be even more complex and hard to manage.
While the 50/50 division of assets laws may govern divorces, in most high-net-worth cases, it can be challenging to determine the future value of some properties before sharing them. For that reason, couples need to approach their divorce with an experienced legal team to help them find a suitable agreement for each party.
If you are dealing with a high net worth divorce, here are some common issues you should know.
Separate Assets and Marital Assets
In most states with community property laws, legally married people are considered one financial unit. As a result, any properties they acquire during the marriage are considered marital assets and must be split equally between them in the event of a divorce. This includes possessions that are only registered in one party’s name.
In some cases, even properties one party owned before marriage can be considered marital assets and must be shared. This is especially true if the assets significantly increased in value over marriage.
However, the division of properties during the divorce may not apply to separate assets. These are assets acquired before marriage, during the marriage as gifts or inheritance, and after the divorce.
Assets Subject to Division in a High Net Worth Divorce
The division of marital assets in a typical divorce applies to items like marital homes, vehicles, and household goods such as furniture and appliances. However, in a high net-worth divorce, the assets to be divided are of significant value.
Common properties wealthy divorcing couples might consider dividing include money in the bank, stocks and investments, insurance policies, retirement accounts, artwork, and antiques. Intellectual property, such as copyrights, patents, or trademarks, a spouse earns during the marriage also fall under the assets to be shared.
How to Determine Property Value
Determining the value of property in a high net-worth divorce is a difficult task. Fortunately, the divorcing parties can consult experienced financial experts for assistance. The experts will help them define if an asset is separate or marital and calculate its fair value.
Finding the actual value of an asset will make it quicker to negotiate an equitable settlement in the divorce process. If a divorcing couple needs to sell certain items to cover costs, financial experts can also help them establish a fair price.
Sometimes, both parties and their financial representatives may disagree about the value of their assets. In this case, it may be best to call an independent financial advisor to help resolve the dispute.
Spousal Support in High Net Worth Divorce
The court can order a spouse to pay support to the other party as a condition of divorce. This is especially applicable if either of the parties gave up vital opportunities during the marriage to support the family. The decision on the amount of support and the terms of the agreement solely rests with the court.
Why You Should Seek Legal Advice in a High Net-Worth Divorce
“Divorce laws in the United States are complex and vary from state to state. Plus, when you are going through a divorce, you may find it hard to think clearly and make rational decisions,” says Attorney Charles D. Jamieson, of The Law Firm of Charles D. Jamieson, P.A.
Fortunately, a divorce attorney with experience handling high net worth cases can help you navigate the legal process and protect your interests. Your attorney will represent you in every stage of the divorce, from filing the divorce papers to calculating the value of marital assets and negotiating with your spouse to reach an agreement.
