While no divorce is easy, some divorces are simple. High-asset divorces are neither. And when a high-asset divorce is handled by an attorney unfamiliar with the complexities, both the divorce process and the outcome can be unnecessarily costly.
Understanding the challenges can help you effectively manage a high-asset divorce in Massachusetts. You can save yourself a lot of worry right from the start by working with a legal team experienced in helping clients achieve their objective in high-net-worth divorce cases.
Classifying and Valuing Marital Assets
In a Massachusetts divorce, couples divide property classified as marital, and each partner keeps their own property classified as separate. So the first issue is to determine how all assets and debts should be classified.
Generally, the property and debts belonging to each partner at the time of the marriage belong to them individually, and the assets and liabilities acquired during the marriage belong to the partners jointly. Certain property received during the marriage, such as inherited assets, might also be treated as one spouse’s separate property, but the other spouse could try to claim a share as marital property, especially if the assets were co-mingled with joint assets. It is important to make your attorney aware of any inherited assets so you can formulate a strategy for either keeping them separate or including them as part of marital property.
Once property has been identified and classified—which can be a substantial job when dealing with different accounts, stock futures, foreign assets, jewelry, artwork, collectibles, and other complex and unique assets—then the next step is to place an appropriate value on that property. In many cases, it is a good idea to work with professional appraisers to get a fair accounting. Often the most challenging assets and debts to divide are those associated with a closely-held business. Assets such as goodwill, intellectual property, and brand value require a professional evaluation.
Distributing Property and Debts Equitably
Couples divorcing in Massachusetts split their assets “equitably” rather than equally. An equitable split is one the court determines to be “fair” based on a number of circumstances. These circumstances include:
- Each spouses’ needs
- Each spouses’ contributions to the property and to the marriage
- Earning capacities of each spouse
- Length of the marriage
- Needs of any children
If a couple reaches an agreement on their own about how they wish to divide assets and debts, the court is likely to approve, and this saves considerable time and money. Often each partner and their individual attorneys will meet out of court to negotiate a division of assets and debts, but this only works to your advantage if your attorney understands how to value and divide complex assets such as pensions and business interests.
Watch for Hidden Assets
High-net worth spouses can be tempted to hide assets, but this is a serious mistake. They might squirrel away funds in an offshore account, give property to a friend, or bury funds in phony business transactions. This is illegal.
When one spouse suspects the other may be trying to hide assets, their attorney can bring in a forensic accountant to investigate. Any attempt to hide assets can lead to fines and cause that spouse to lose credibility with the court, which can lead to a greater settlement for the other spouse.
Koiles Pratt Family Law Group Manages High-Asset Divorce to Help Clients Succeed
If you are facing a high-net-worth divorce, you deserve legal advice and representation from attorneys who understand the issues and the strategies necessary to succeed. Contact the experienced team at Koiles Pratt Family Law Group for a confidential consultation to learn how we could manage your high-asset divorce.