High Net Worth Divorce
Divorce can be complicated no matter what the underlying circumstances are. High-net worth divorces, however, are always complex.
When executives, entrepreneurs, business owners, professionals, and other high net worth individuals divorce, the matter requires immediate attention. It needs more experience beyond dealing with the ‘typical’ divorce case because of its complexity.
Failure to address the complexity as soon as possible can have lasting, long term consequences – perhaps for generations.
It can be a difficult time. Experienced high-net worth divorce lawyers can help shoulder the burden and supply the support and knowledge you need to protect . . . everything and everybody.
Attorneys who successfully handle high-net worth divorces must thoroughly understand the issues surrounding business valuation, complex alternative investments, trusts, overseas accounts and property, real estate holdings aside the primary family home, tax law, and prenuptial and postnuptial agreements.
It can get incrementally more complicated from there.
Executive and entrepreneur divorces may well involve byzantine histories and require extensive documentation far beyond those for most dissolutions. The stakes are high, and the outcomes may have immeasurable, long lasting impact on quality of life, distribution of assets, support, and more.
Alternatives to Litigation
With so much at risk, it’s no surprise that High Net Worth divorce actions have the potential to quickly become contentious. Talking early with your spouse about alternatives to litigation should be a serious consideration - the earlier in the process the better.
It’s important, sometimes vitally so, to try to minimize the chance a spouse will become combative. That almost inevitably leads to heavy litigation, lengthy and intense discovery, and, ultimately, publicity.
Exploring and pursuing a mediated or collaborative approach early may not only avoid litigation but public attention and scrutiny as well.
The attorneys at Hopkins Centrich Law will help facilitate it if it is at all possible.
Building a Financial Picture
High Net Worth divorce is a team effort that needs to start early. Appraisers, valuation experts, accountants, and financial planners who specialize in divorce – to name a few – are integral to a successful outcome.
If needed, court orders can be obtained to stop asset liquidations not in your interest and/or to protect cash flows from a business or insure its continued operation.
High net worth divorces require a careful consideration of realistic scenarios and potential solutions. “Be ready for . . .” is a phrase that should be uttered often through a high net worth divorce.
Business Valuation: Determining the value of a business/practice can prove problematic especially where only one spouse is the owner. Valuation methods vary by business type and can be asset-based, income-based, or market-comparable-based.
Assets like copyrights, trademarks, patents, and other intellectual property are difficult, at best, to value. Even among experts opinions can significantly vary.
Tax consequences: different types of property face different tax consequences when they are divided and/or liquidated for alimony awards.
There are many other considerations that make compiling a realistic financial picture difficult. They are wide ranging and often hard to find, never mind value: art, antiques, collections, partnership agreements, employment agreements, benefit and retirement plans, inheritances, prenuptial agreements and more.
Marital Property in High Asset Divorces
Another complicated feature of a high asset divorce is the division of marital property. The Texas Family Code states that property division must be done in a “just and right” manner. Our courts adhere to the theory of equitable division when dividing marital property.
It is important to understand that equitable does not mean equal.
With complicated and hard to value assets common to high net worth divorces comes inherent difficulties in trying to divide them. It is, then, vital that the financial picture be a full and complete accounting of assets and debts to be divided.
Hopkins Centrich Law’s legal team thoroughly understands issues including closely-held businesses, complex employer retirement benefits, inheritances and gifts, and prenuptial agreements.
We care about what you want for your post-divorce life. Our first task is to help you identify and prioritize your goals.
We will build a legal strategy that’s focused on what matters most to you.