When a married couple with significant assets between them decides to divorce, this is often described as a “high asset” divorce.
This can often make the divorcing process more difficult because there is a lot more to consider for both parties in making sure their property, and rights, are protected.
Is there a strict definition?
Although there is no standard definition of a high-asset divorce, it is generally accepted to apply to situations when the entire value of the marital estate exceeds $1 million.
More significantly, it’s a term that describes a scenario where the financial position of the divorcing couple is more complicated as a result of the significant number of assets, investments, and money they have combined.
Some of the issues that divorcing couples with a high net worth find themselves facing include:
- The valuation (and division) of property
- Deciding what is community property and what is separate property
- Navigating the difficult tax implications
High asset divorces can also include complex holdings, like:
- Property, including the marital residence, second homes or investment properties. This may include assets acquired either before or after the marriage.
- Irregular income tied to a spouse’s position in a company, like bonuses or other rewards provided in connection with their workplace performance.
- Retirement funds include things like 401(k) plans, individual pensions, and any military retirement benefits.
- Business endeavors, either individually or on behalf of each party. This could be, among other things, a PLLC or an S Corporation.
There are factors that may complicate the divorce process for an affluent couple. Obtaining legal guidance can give you the best chance of protecting your assets and navigating the process.
