Although divorce is difficult for anyone, couples with a high net worth face unique challenges. These individuals typically have $1 million or more in liquid assets. Due to the complexity of assets and debts, these cases often take longer to settle. An experienced divorce attorney can help you navigate the challenges of a high-net-worth divorce and protect your interests.
What Makes a High Net Worth Divorce Challenging?
Generally, a high-net-worth divorce can be more time-consuming and complicated due to the number of assets involved. These assets may include businesses, investments, intellectual property, retirement accounts, boats, planes, art collections, and other high-value items. In addition, if you and your spouse run a business together, you must determine how you will divide this business.
Factors in High Net Worth Divorce Cases
Factors that may come into play during a high-net-worth divorce often include:
Property and asset division
Medical, legal, or other professional practices
Business partner agreements
Artwork, jewelry, and other high-value items
Child support and custody
While these are not unique to cases involving high-net-worth couples, these issues can become decidedly more complicated during divorce proceedings between couples with substantial wealth or assets. It is essential to consult an experienced divorce attorney as soon as possible to avoid mistakes and ensure your best interests are protected.
Complex Property Division
Equitable asset and property distribution are essential in high-net-worth divorce cases. An experienced divorce attorney will carefully evaluate the value of your existing properties, including vacation homes, IRAs, joint or individually owned businesses, and other assets. Forensic accountants will sometimes be utilized to ensure no assets are being hidden, a common tactic used in high-net-worth divorce cases.
What Is Considered Marital Property?
Nevada is what's known as a community property state. This means that most assets, income, and debts accrued during your marriage should be divided equally unless you entered into a pre- or postnuptial agreement. In most cases, the property each spouse brought into the marriage remains separate, but some exceptions may apply.
How to Prepare for a High Net-Worth Divorce
Prepare a List of Assets and Liabilities
You must have a thorough understanding of your actual net worth. Write down a list of your assets and debts. This will help you determine which assets you prefer to keep after the divorce and what you are willing to negotiate with your spouse. Include real estate, businesses, retirement accounts, investment portfolios, cars, jewelry, and other valuable assets. Don't attempt to hide assets from the court. The courts can review the transfer of assets and may consider such actions fraudulent. Attempting to hide assets can severely impact the outcome of your divorce settlement.
Don't Forget About Your Retirement
Your retirement may be many years away, but it should be a top priority during your divorce settlement. Retirement accounts may need to be divided through Qualified Domestic Relations Orders (QDROs). Because private plan administrators control most retirement accounts, they cannot simply be divided. The QDRO is a document that allows the plan administrator to disburse a portion of the fund's account to an alternate payee - typically the ex-spouse of the account holder - while preserving the privacy rights of the plan's participants.
Plan to Hire Additional Professionals
One of the significant challenges of a high-net-worth divorce is uncovering all marital assets and debts and determining their respective values. You will likely need to take additional steps, such as hiring a professional to assist with a business valuation or a real estate agent to determine the value of your properties. If you believe your spouse is hiding assets, you may need to hire a forensic accountant to help uncover hidden assets.
Discuss Tax Consequences with Your Tax Accountant
As the value of your investments can fluctuate, these fluctuations must be considered when dividing a divorcing couple's investment portfolio. It is also essential to consider the tax burdens that will occur when dividing your assets.
Develop a Post-Divorce Financial Plan
One thing most people fail to consider is that their divorce settlement proceeds and/or assets may need to last for a long time. Good financial planning can help people prioritize their financial goals, develop a realistic budget, and produce a sound plan for making the most of their marital property division.
Don’t Be Tempted to Rush Into a Settlement
Agreeing to a quick settlement is rarely in anyone’s best interests. One party may take advantage of the other party’s desire to get things over with quickly and convince them to agree to an unfair division of assets. Rushing a settlement increases the likelihood of not uncovering and properly valuing marital debts and assets. In some cases, creditors can come after one spouse for another spouse’s unpaid joint debt - even if the other spouse didn’t know the debt existed. Take your time and make sure you have reached an equitable settlement.
Consult With an Experienced Divorce Attorney
Any divorce can quickly become complicated. If you are facing a high-net-worth divorce, consult an experienced attorney who will aggressively fight to protect your assets. An attorney can help you with the following:
Determine if mediation is a viable option
Protect assets that are important to you
Determine which assets are marital property
Help you enforce a prenuptial agreement
Determine appropriate spousal support
Divide shared interests in a business or businesses
Help you resolve child custody issues
The Leavitt Family Law Group supports clients with high-net-worth divorces, providing them unparalleled client service, responsiveness, and accessibility.
The Leavitt Family Law Group Can Help
Nothing is easy about getting a divorce. Disagreements over child custody and asset division are common. However, most divorce cases are settled rather than taken to trial. An experienced attorney can help you achieve a reasonable settlement to accomplish your goals and move on with your life. Call the Leavitt Family Law Group at 702-447-0084 or contact us online when you need a family law attorney. We serve clients in Henderson, Las Vegas, and surrounding communities.