While every divorce presents its own unique set of issues and concerns that must be resolved, a high asset divorce (also known as a high net worth divorce) can be particularly challenging as they oftentimes involve a significant amount of money, real estate, and investments. With a lot to lose financially, it is imperative that couples with substantial assets take steps to avoid some of the top mistakes that can occur during a division of marital assets in a divorce. Especially if you are trying to protect your high net worth during a divorce.
Given that any mistake could lead to devastating financial losses for one party or the other, you should not hesitate to hire an experienced West Palm Beach divorce attorney who can help protect your assets in a high asset divorce and work with you to achieve a fair and equitable division of marital property in accordance with Florida law.
Costly Mistakes in High Net Worth Divorces
High net worth divorces typically involve significant assets including multiple residences or vacation properties, other real estate investments, business ventures, stocks, trusts, boats, multiple vehicles, artwork, pensions, 401(k)s, and multiple bank accounts. Any of these assets that were acquired during the marriage, with the exception of inheritances and gifts, are generally considered to be marital assets and are owned jointly by both spouses. Therefore, division of these assets can be complicated.
When planning on a divorce one of the first steps you should take is to consult with a skilled divorce attorney so that you can learn about what you should and should not be doing to prepare for a divorce. The following discussion touches on a few of the mistakes you should avoid in a high asset divorce:
- One of the top mistakes you should avoid when seeking a divorce is to agree to anything just to get out of your marriage. The divorce process can be lengthy, frustrating, and emotional, so it is easy to get fed up and sign away the property that may rightfully be yours. However, you may end up regretting your decision later on, so it is important to recognize that with time and effort, you and your attorney can work towards a fair and equitable asset agreement.
- In a high net worth divorce, it is particularly important that you refrain from hiding any assets during your divorce proceedings. When it comes to equitable distribution of property in Florida, the process of identifying all the assets, income sources, and liabilities involved can be extremely complex. If one party hides assets, such as jewelry, cash, or bank accounts, and the other party does not know about these hidden assets, then a court will not be able to divide a couple’s assets properly. It should be noted that when you are a party to a divorce, you have a duty to disclose your assets to the other spouse. Even if you think you can transfer valuables to a third party to hide them from your spouse, if the court finds out, the transfer is likely to be found fraudulent, which can adversely affect your credibility before the court.
- With all the focus on assets, it is important to remember to disclose your debts and liabilities as well. While failing to disclose your liabilities may be considered fraudulent, it could also hurt you in the long run. For example, if you have an outstanding credit card balance that was acquired during the marriage, and you do not disclose it to the other party, then you may end up with more liabilities than you should at the conclusion of your divorce.
Other Issues the Arise In a High Asset Divorce
The Family Business and Working with an Appraiser
When one or both parties own and run a business, it is likely in the best interests of both parties that the business remains viable and growing during the divorce. An experienced West Palm Beach Divorce Lawyer can work with you to make sure your business assets are protected and that you receive a fair value from the business. Because the value of the business interest can be difficult to determine, divorce attorneys will typically work with appraisers or business valuation experts in order to assess the value of the family business and to equitably divide the parties’ interests in that business.
The Need for a Forensic Accountant
When parties have a high net worth, many assets that they own may be more difficult to value than others such as artwork, stocks, and significant real estate holdings. Because figuring out the value of these assets can be difficult, even for a regular accountant, divorce attorneys often suggest consulting with a forensic accountant. A forensic accountant is a financial professional who has auditing and investigative abilities that extend beyond just preparing income tax returns. A forensic accountant can figure out the exact value of your assets by going through years of financial and transactional records, and they can be particularly helpful if you believe that your spouse has hidden assets from consideration in the divorce proceedings.
Stocks and Bonds in a High Asset Divorce
Certain investments that are involved in a high asset divorce may be considered separate property, particularly if they were purchased before your marriage. However, any contributions to and earnings on those investments that occurred during the marriage are likely considered marital property. An experienced divorce lawyer can help you to identify all of your property, including investment accounts. Remember, as mentioned above, it is extremely important to disclose all investments in order to achieve a fair division of property.
Contact a Dedicated and Knowledgeable West Palm Beach Divorce Attorney Today
When it comes to high asset divorces in Florida, the issues that arise can be particularly complex and challenging. That’s why it is important that you consult with an experienced West Palm Beach Divorce Attorney as soon as possible. At Eric C. Cheshire, P.A., we focus our practice exclusively on divorce and family law. We have extensive experience handling divorce cases that involve significant assets. If you’re looking to file for divorce, regardless of your situation, and have questions regarding the process, call us today at (561) 677-8090. The first step is to schedule your consultation and find out what we can do for you.