Divorce is never easy. Even in the most amicable and straightforward divorce, emotions tend to run high. Change can be intimidating because we don’t really know what lies around the next corner. And that is never so true as when two people who spent years building a life together decide that it is time to split up.
But when you are part of a couple that has accumulated substantial wealth, the stakes are higher and tensions can build to surprising levels. You have probably spent years sacrificing to create an abundant lifestyle for yourself and your family, and suddenly, finances seem uncertain. When many assets are at stake, their division can be traumatic if you put your fate in the wrong hands. The experienced high net-worth divorce legal team at Batson Nolan PLC, can guide you through this labyrinth of legal procedures, so you can rest assured that your interests are fully protected.
Tips for Your High Net-Worth Divorce
When there is a great deal of money at stake, things intensify quickly. Here are three areas of particular concern in divorces involving large estates.
Be Aware of Attempts to Hide Assets
It is typical for one or both spouses to think about hiding assets in a high net-worth divorce. Tennessee is an equitable distribution state. This means that in a divorce, the judge’s goal is to distribute wealth generated during the marriage equally between both parties. Contrary to popular belief, this does not always mean a 50/50 split. But it does mean that the property and assets are divided reasonably and fairly. To arrive at a fair distribution of assets, the judge considers a number of factors that are listed in Tennessee Statutes Annotated Section 36-4-121. Familiarize yourself with those factors so that they don’t blindside you as your divorce progresses.
When one party attempts to hide assets, the other stands to lose a substantial amount of the wealth they helped generate. Hiding assets before or during a divorce is problematic and makes the perpetrator lose credibility before the court. So if you are considering this tactic, think again. You want to be the person the judge trusts, not the one whose testimony is questioned.
Signs that your spouse may be hiding assets
If you suspect your spouse is trying to hide assets, here is what to look for:
- Expensive purchases—spouses may buy expensive items, undervalue them during the divorce, and then sell them at full-price after the divorce to avoid fair distribution.
- Lower paychecks—spouses may get their company to pay them partially in cash so that bank accounts show less income.
- Gift Giving—if your spouse is suddenly and uncharacteristically generous in giving away property to people as “gifts,” this is a warning sign. They can “gift away” many valuables, only to have the recipient gift those valuables right back post-divorce.
- Using businesses as a front—if your spouse owns their own business, it is fairly easy to bury assets. One example would be writing paychecks to employees who do not exist.
- Delaying lucrative opportunities—spouses can purposely put off lucrative business ventures or bonuses until after the divorce is final.
Hidden assets is a real concern in high-asset divorces. Since hiding assets can result in criminal charges, you don’t want to make any mistakes yourself. Likewise, you don’t want your spouse hanging you out to dry. Having a skillful and savvy attorney by your side can help you avoid mistakes that can make you look bad and make certain that you get your fair share.
High asset divorces involve a number of complex financial considerations. A wealthy couple tends to have far more accounts, investments, and expenses than a less affluent couple. This typically means that attorneys and accountants must dig through years of financial records to present the fullest and most accurate financial picture to the judge. Untangling assets in a high net-worth divorce is particularly tricky, especially if the couple has a business together. But this legwork is critical to the proper allocation of funds. You need a lawyer and possibly an accountant to sort through many assets, including but not limited to:
- Bank accounts;
- Family-owned businesses;
- Corporate shares if either spouse is a shareholder;
- Retirement accounts, pensions, and 401(k)s;
- Military retirement accounts;
- Executive compensation plans;
- All real estate owned, whether residential, commercial, or vacation homes;
- Stocks and stock options;
- Valuable collections; and
- Trust funds.
With so much at stake, you should never attempt to do this type of investigation yourself.
Alimony in high-asset cases is more of an issue than in low-asset divorce. The judge seeks to assist each spouse in maintaining the lifestyle they have become accustomed to during the marriage. This is particularly true in long-term marriages, where both spouses have sacrificed for the greater good. A judge considers the following factors when deciding alimony in such cases:
- The duration of the marriage;
- The age of each spouse;
- The mental and physical health of each spouse;
- The contribution of each spouse to the marriage and wealth accumulated;
- The standard of living enjoyed by each spouse during the marriage;
- The paying spouse’s income level and ability to pay; and
- The receiving spouse’s need and ability to generate income.
The judge looks at these factors and any other factors they deem appropriate when deciding whether to grant alimony, to whom, and how much to award.
Divorce is an unpleasant business, but even more so when there is a lot of money at stake. The seasoned divorce legal team at Batson Nolan PLC have been through this with clients many times before. In a high net-worth divorce, we know what to look for and how to find it. We will go to work immediately to protect your financial interests and make certain that you receive your fair share of the wealth you helped build. Call us today or contact us online to set up a free consultation in our Clarksville or Springfield office.