Are you and your spouse considering divorce, and
- One of you earns substantially more than the other?
- Someone has inherited family wealth or receives funds held in trust?
- Someone owns a business?
- Someone is due deferred compensation or has unvested stock options or shares?
- You own valuable art or collectibles?
- You own real property or other assets out of state or in another country?
You need the help of an experienced high asset divorce lawyer.
The Philadelphia divorce lawyers at Schwartz, Fox & Saltzman, LLC. explain what high asset divorce law is, how a high asset divorce differs from other divorces, and what considerations arise in a high asset divorce.
If you have questions about your high worth divorce, call us for help. For over fifty years, we have helped couples in Philadelphia and the surrounding area successfully negotiate and settle their high asset divorces.
What is a High Net Worth Divorce?
Typically, a divorce is considered “high net worth” or “high asset divorce” when the couple’s combined assets are substantially higher than the average divorce action. Assets such as family wealth, an inheritance, a closely-held business, deferred compensation, real estate holdings in other states or abroad, assets held in trust, rare or valuable art or collectibles, and stocks or stock options often are the types of cases that are considered high-end divorces. There are often valuation issues to be considered. A divorcing couple in this situation should seek the help of an experienced high asset divorce lawyer.
Regardless of exact value, the more complex a couple’s estate is, the more likely they require the services of a high asset divorce attorney.
How High Asset Divorce Differs from Other Divorces
A high asset divorce attorney will be skilled in negotiation and settlement. There is a lot at stake in a high net worth divorce.
These types of divorces may involve family wealth or a family business. The distribution of assets in a high asset divorce often affects many more people than just the divorcing couple, such as employees, business partners, future generations of the family, and charities that rely on the family’s contributions. The use of financial consultants, appraisers and actuaries, among other experts, is common.
In particular, a high asset divorce lawyer must assess the value of assets and the tax implications of the divorce, exercising stock options, transferring ownership, and consults with experts including appraisers, forensic accountants, real estate valuators, business valuators and economists to best advise the couple about fair and equitable distribution of their assets while minimizing their tax burden and preserving tax benefits such as capital loss carry-forward.
Understanding Your Finances in a High Asset Divorce
A high asset divorce attorney must be creative in crafting settlement options for a high worth couple, considering all of the following:
1. Equitable Distribution
Pennsylvania is an equitable distribution state. Marital assets are subject to equitable distribution, not necessarily equal distribution, upon divorce regardless of who earned or obtained them.
2. Separate Assets
The couple may have earned or obtained assets prior to getting married. These are generally considered individual property and are not subject to equitable distribution. That said, a couple may have entered into a prenuptial agreement that established separate and individual assets regardless of when those assets were obtained. However, without a prenuptial agreement, the appreciation in value of these separate assets are considered marital property.
3. Out-of-State & International Assets
Out-of-state and international assets are a challenge to value, and a high worth divorce attorney must research the rules, regulations, and laws of the asset’s location to determine how and whether the asset can be transferred, and at what cost to the couple’s entire estate.
4. Inherited Assets
Inherited assets, whether inherited before or during marriage, are separate assets. However, the use of these assets during the marriage can alter the status of those assets.
5. Assets Acquired Prior to Your Marriage
Generally, property acquired and money earned prior to marriage is individual property, not marital property. Again, however, the increase in value of these premarital assets is marital property, absent a prenuptial agreement.se.
6. Tax Implications
In a high asset divorce, the parties must consider both the tax burden and the loss of tax benefits when crafting a property settlement agreement. A high asset divorce attorney will consult with an expert to ensure the couple has a complete and accurate picture of the tax implications of various settlement options.
Manage Spending During Divorce Proceedings
To prevent unnecessary depletion of the couple’s estate, a high asset divorce attorney and an economic consultant will help their client craft a fair budget that they can utilize both during and after the divorce.
Spousal Support & Alimony Pendente Lite Payments
In a high-asset divorce where one party earned or obtained much more of the marital assets, the other party may be entitled to payments during divorce proceedings (alimony pendente lite) and alimony when the divorce is final, depending upon factors such as:
- How long the parties were married
- The needs of the party receiving alimony
- Whether or not the dependent party has the ability to work
- Any extraordinary expenses.
A party may be entitled to spousal support or alimony pendente lite during a divorce. Consulting with an experienced family lawyer is critical.
Why You Need a High Asset Divorce Lawyer
If you and your spouse are considering divorce and this article in any way addressed your financial situation,be sure to engage an attorney with experience in high end divorces. The financial ramifications of not doing so can be catastrophic for you, your children and grandchildren, your business partners and employees, and anyone else who relies upon you financially.
Worrying with an effective high net worth divorce attorney with the experience to assess your estate and consult with the appropriate experts and professionals is very important.
Find Representation Early
The sooner you consult with an experienced high net worth divorce lawyer, the greater chance your assets will be protected and accurately assessed for value and tax implications, and the more likely you will secure a property settlement agreement that protects you as much as possible .
Talk with an Experienced High Net Worth Divorce Attorney
Contact us today for help with your high asset divorce. We have over fifty years experience helping people in the Philadelphia area successfully negotiate their high worth divorces, and we can help you and your family too.