If you and your spouse have had the good fortune to live a prosperous married life, divorce can present a unique set of difficulties when the stakes are high. Despite what may appear to be a perfect life and a perfect marriage, circumstances change that can turn your world upside down. When you or your spouse decides to file for divorce, it’s important to immediately consider how you are going to protect yourself. You need to consider all your options, both personal and financial. For the sake of your family, your business and your future, it is critical that you understand what a divorce will entail and the range of possible outcomes.
I believe that the best strategy, especially in a high asset divorce, is a proactive strategy that maximizes discretion while customizing financial and parenting solutions tailored to your specific situation.
Why is a high-asset divorce different?
While the issues in high-asset divorces are similar to other divorces, the stakes can be exponentially higher. Typically, the assets are not just “more”, but more diverse. Some types of problems that arise when valuing these assets include:
- Determining the value of retirement assets like 401Ks, IRAs, stock options, trusts and other investments
- Evaluating the value of a business owned by one or both spouses
- Dividing marital debts fairly
- Deciding how to allocate the marital home’s value, any indebtedness, whether to sell it, and what to do with vacation homes and other property.
- Agreeing on what is separate property, which is typically property accumulated by one spouse before the marriage, and determining if the other spouse has any ownership interest in that property.
In Tennessee, courts use a principle called “equity” to determine how best to divide marital assets. This means that the assets and debts are not necessarily divided exactly in half. Equitable distribution means that the court tries to determine what is fair and reasonable based on the factors set out in the law. In order to ensure the court makes a truly equitable division of assets and debts, or that the parties reach a fair settlement, it is essential that all assets and debts are fully known and understood by both parties.
What are problems that can occur in a high-asset divorce?
I see many of the same issues repeatedly causing problems with settlement in high-asset divorce cases. I employ various strategies to uncover the actual financial picture and help my clients achieve settlement, or to prepare for a trial where the judge can get a full and accurate accounting of the parties’ holdings.
Sometimes a spouse tries to conceal assets by underreporting income and/or passing assets off to friends, associates and/or family members to hide. This could be in the form of cash, deductions and depreciationon tax returns, inconsistent real estate appraisals, and other subterfuge. I work with experts to review tax returns, bank statements and credit card statements to gain a full financial picture and make sure you receive a settlement or judgement based on accurately determined assets, debt and income.
Valuing a business
When one or both parties have built a business during the course of the marriage, it is important to decide who will continue to operate the business after the divorce. The spouse who does not operate the business may still be entitled to profits and/or spousal support. I work with experienced professionals who will value the business and the spouse’s past and future income to determine what your share of the company is worth.
Tennessee courts look at the length of a marriage to determine how much long-term support, or alimony, a party should receive. The court will also look at the amount of property each spouse is awarded to determine if, and how much, spousal support is necessary to keep the parties in the lifestyle that they have enjoyed during the marriage. Tennessee courts have trended away from long-term spousal support in recent years. The courts have moved toward other types of alimony that help a spouse transition to life after divorce, or rehabilitate themselves by achieving the ability to make their own income. Sometimes, short-term or long-term support is still appropriate. I will carefully evaluate your situation to learn what may happen in your case. I make sure that you understand what will happen once the divorce is final so that you can prepare for you post-divorce financial future.
Why am I the right lawyer for your case?
My clients always tell me how uncomfortable, and sometimes humiliating, it is to be forced to share intimate financial details with an attorney. I know first-hand how hard this is, as I did it during my own divorce. That’s why I believe discretion is one of the most important tools I use in evaluating a client’s financial picture. I employ creative solutions to tailor a settlement, or trial strategy, for each client based on their unique economic situation and needs.