High-net worth couples often own assets that require special attention during the divorce process. These can include a large amount of stocks, bonds, real estate, businesses, and more.
Because of these complexities, the courts can take longer to complete a high net worth divorce. That’s because there are more questions than normal to answer and more steps to take.
Real estate
Real estate is one of the most difficult types of property to divide in a high net worth divorce. There are a number of issues that may arise when determining a fair value for a house, such as property taxes, appraisals and values of comparable houses in the area.
A good New York high net worth divorce attorney can help with identifying and valuing real estate assets. Additionally, he or she can assist with determining the value of any assets that were acquired before the marriage.
High net worth couples may have multiple homes, vacation properties, business interests and other types of real estate. They may also have large amounts of cash and stocks, bonds, trusts and other investments to consider.
In most cases, assets must be appraised and disclosed to a court before they can be divided in a divorce. This is especially true when a couple owns business interests or real estate, as these can be difficult to value.
Investments
High net worth couples are often faced with a complex portfolio of assets during a divorce. These include business interests, investment properties, retirement funds, trusts, and more.
In order to properly divide these assets, the court follows the theory of equitable distribution. That means that the court will look at all parties’ financial circumstances and decide what is best for them.
As in any divorce, the court must fully account for all assets on a disclosure statement. This can be a daunting task for high-net-worth spouses because they may have extensive retirement accounts, investment properties, and international properties.
During the process, the parties will work with financial experts, such as forensic accountants and business valuators, to determine an accurate valuation of their marital estate. That valuation will be used to inform negotiations.
Business interests
One of the most complex issues that must be addressed in high net worth divorces is how to divide business interests. This may involve determining whether a spouse should keep the business, sell it or acquire the other spouse’s interest in the business.
In other situations, the couple may decide to continue operating the business and co-own the business together. If they are able to do this, it will avoid the need for litigation and allow the spouses to remain productive in their roles as co-owners.
The next issue that must be considered is how to value the business. This can be done in a number of different ways, including income-based valuations.
In addition, forensic accounting and other financial specialists can help uncover assets that are hidden or not valued. This can include tax loss carry-forwards, offshore investments, unique collectibles, and interests in a closely held business.
Personal property
When couples divorce, they often have to worry about the finances, property and child custody. When couples have assets of significant value, however, this can create more problems than in standard cases.
In a high net worth case, every asset must be accounted for, valued and divided. That means hiring financial experts to help with valuations and forensic accountants to uncover hidden assets.
Personal property such as art, antiques, collectibles and vehicles are just a few of the things that may be subject to division in a high net worth divorce. These can have a monetary value, but they may also have sentimental or replacement costs.
In addition, high net worth divorces can be complicated because they have assets located in multiple jurisdictions. Each state has its own set of rules regarding how to divide property equitably, and each can introduce new complexities to the process.
