Tag Archive for: high asset divorce

Have Wealth and Divorcing? Know the Issues

Wealth and divorce are a combination with a high potential for conflict. Many divorcing couples clash over money, but it can get much worse when the stakes are high and both sides have a lot to lose. 

If you hold significant assets, you need a solid strategy for protecting your finances during divorce. You may want to look into the following high-net-worth divorce considerations. 

Separate vs. Marital Property

Generally, all the assets you gain during marriage, including real estate, businesses, IRAs, and other investments, count as marital property and are subject to division during divorce. In contrast, assets you acquired before your marriage and kept separately, as well as inheritances, gifts, and some settlements and benefits, are separate property and aren’t part of the marital estate.

In addition, you and/or your spouse may hold assets you defined as separate in a prenuptial agreement. Spousal support and prenuptial agreements are another issue to consider as you prepare for divorce.

Hidden Assets

Having wealth and divorcing also means you should keep an eye on your assets to ensure your spouse isn’t trying to conceal property. For example, as soon as your spouse understands the marriage is over, they may start siphoning money from your joint accounts into an offshore trust. 

Pay attention to red flags like inexplicable cash withdrawals or transfers, incomplete financial records, or a sudden decrease in your spouse’s income. If you suspect your spouse is concealing assets, your next step should be finding qualified divorce lawyers for wealth management.

Tax Implications

You’ll also need to consider the tax implications of high-asset divorces. For example, if you retain real property as part of your asset division, from now on, you’ll be solely responsible for property taxes and rent taxes if it’s investment property.

Divorce-related property transfers are generally tax-free. However, you must maintain careful records of any transfers because you need to note the cost basis for capital gains tax on any property you sell after divorce.

Businesses, Intellectual Property, and Patents

Property division becomes even more complicated if you run a business or hold intellectual property jointly with your spouse. You may need to decide what to do with your joint venture, like selling the business and splitting the proceeds. Alternatively, one of you may buy out the other’s share.

Patents and other intellectual property are also part of the marital estate if acquired during the marriage. This means that if one spouse holds a trademark or patent, the other may be entitled to some of the profits from the intellectual property and awards from infringement lawsuits.

Karen Ann Ulmer, P.C.: Protecting Your Wealth During Divorce in PA and NJ

Are you divorcing and wondering what to do about personal wealth? You need a legal professional to protect your financial interests and peace of mind.

The skilled lawyers of Karen Ann Ulmer, P.C. can guide you through the division of assets in a complex divorce and help you reach a fair agreement. Call (866) 349-4907 or schedule a consultation online. 

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Divorcing When Wealthy: Please Use Common Sense

Divorce is never an easy decision, but when wealth enters the equation, it adds layers of complexity that can make the process more challenging. High-net-worth individuals face unique issues and considerations when seeking to dissolve their marriages. Nearly all divorces are resolved through negotiations, and negotiations are especially important when a couple is wealthy.

Legal Representation

The more the two of you have, the more is at stake in a divorce. High-net-worth divorces require specialized legal representation and the use of outside experts. You rely on other professionals to run your business or manage your wealth. It only makes sense to retain a Karen Ann Ulmer, P.C., attorney to protect your interests during this critical time in your life. We will help you negotiate the best resolution possible for you and your family.

Equitable Asset Division

One of the most significant challenges in a high-net-worth divorce is the division of assets. The greater the assets and the more complex they are, the more difficult it can be to unwind the financial relationship between the two of you. Once we get all the information about the assets you hold, we can begin to negotiate a fair and reasonable division that will work for both parties.

Prenuptial Agreements

Prenuptial agreements are legal documents specifying the division of assets if the couple divorces. These agreements are especially useful when one or both parties have substantial wealth. If the two of you signed an agreement, we can review it.

If it is properly written and executed, it is binding. All that the agreement covers cannot be disputed or litigated during the divorce. That is good if the agreement is favorable to you, not so much if it is not.

Spousal Support

Depending on the circumstances, wealthy individuals may be required to pay substantial spousal support (alimony) to their former spouse. The marriage’s length, the income disparity between the parties, and the lifestyle to which the spouses are accustomed play a role in determining the amount and duration of spousal support.

Negotiating this aspect can be contentious, and often, the party potentially paying the support may be able to lessen or eliminate it if the other party receives certain assets or other issues are negotiated in their favor.

Business Interests

For those owning businesses, divorce can significantly impact a company’s operation and ownership. It is vital to consider the implications of a divorce on the business, including issues like stock ownership, control, and valuation. Depending on which side you are on, you want to protect your business interests and ensure its continuity, or you want your fair and equitable share of the company. Negotiations concerning the ownership of a family business can become emotionally charged, but it is something we have successfully handled many times.

Take the Best Approach

Litigation involving high-net-worth individuals can be very complex, time-consuming, and expensive. Those with more resources can spend more on litigation, but that is not necessarily a good idea.

In addition to spending hard-earned family wealth in the courtroom, divorce trials are open to the public. Whatever “dirty laundry” aired at trial can become public knowledge. You also lose control of the divorce’s outcome when it is put into the hands of a judge or jury.

Reaching a divorce settlement is like negotiating a business deal. It is all about costs, benefits, risks, and how to best manage them. Your divorce will be resolved one way or another. If the parties are reasonable, common sense will dictate the give and take between the parties. Once both parties know all the facts about your assets and other relevant issues, it is best to start negotiations sooner rather than later, because they could take a long time.

If your spouse is unreasonable when negotiating or sees the divorce as a way to get “payback,” litigation may be inevitable. Whatever path your case takes, Karen Ann Ulmer, P.C., attorneys will protect your interests and defend your rights.

Get the Help You Need from an Attorney You Can Trust 

If you are thinking about getting divorced or you have decided it is the right choice for you, call us at (215) 608-1867 or schedule a consultation online now. No matter your income or assets, you can start a new chapter in your life. We can discuss your situation over the phone, via a teleconference, or meet in our Langhorne or Doylestown office. 

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