Why High Net Worth Divorces Are More Complex
When substantial marital estate is involved, the division of property and divorce process becomes more contentious and complicated, with disputes arising at every single point. It is common for individuals having high value to have significant marital estates, which may include business interests, real estate holding, investments, complex trusts, international assets, and retirement accounts. These high net worth assets can make divorce proceedings highly complex, making property division challenging for everyone involved.
Illinois is an equitable division state when it comes to the division of marital property. Courts take into account several factors, such as employability, occupation, health, age and income sources of each spouse when determining how the assets and property can be equitably distributed. The Illinois law clearly states that the marital property must be divided fairly and equitably, which means that it doesn’t necessarily have to be equal.
There are several factors that may make a high net worth divorce more complex. A few important aspects include:
Evaluating the Nature of Assets
One of the most difficult tasks is identifying assets in a high net worth divorce. There are certain assets that one spouse may have acquired before the marriage and may be considered as a separate property. However, if the asset appreciated in value in during the marriage, it may be considered as a marital property and will be subject to division. If there are prenuptial agreements in place, high net worth divorce cases can become less complex, as they affect the rights of one spouse over the other’s property.
Complex Issues Relating to Assets
Several asset related issues are involved that can make a high net worth divorce more complex. Generally, spouses have multiple properties and interests in businesses. During property division, businesses can suffer in numerous ways, as they can change an owner’s attitude towards productivity, concentration, and risk. Moreover, when a portion of business is shared with an ex-spouse, it can have a direct impact on business operations.
Mostly spouses try to hide assets so that they are not divided during the divorce. Forensic accounting is done to track down hidden assets and assess the actual total value of financial holdings of both parties. The accountants may also be used to accurately label which property is marital or separate.
High net worth divorce cases often involves complexities when one of the spouses has investments or assets in another country. This may also entail tax implications that require the help of an attorney who has an in-depth understanding of out-of-country high net worth assets and international issues.
Complex tax issues are generally associated with high net worth assets. Tax considerations mostly relate with benefit plans, business entities, spousal support, and real estate.
If you are going through a high net worth divorce, it is advisable to work with a high net worth divorce attorney who can help you understand the complexities and issues pertaining to the process. Contact the Law Office of Fedor Kozlov, P.C. today at (847) 241-1299 to schedule a free initial consultation with our experienced divorce attorney.