One of the things that can complicate a divorce is dividing assets. In
Illinois, property is separated into marital and separate property. Everything
under the umbrella of “marital” is then split as equitably
as possible between the spouses. However, this can be complicated with
people of high net worth. Those of high net worth are typically considered
individuals who have at least $1 million in liquid assets, meaning they
can turn it into cash at a moment’s notice. Here are a few reasons
high-asset divorces can be complex.
People with high net worth often have many investments. It can often be
difficult for people to keep track of every single business venture that
you supported financially. Often, people of high net worth use valuation
specialists or forensic accountants to take full stock of the breadth
and value of their entire portfolio, the value of their businesses, and
Prenuptial and Postnuptial Agreements
Often any agreements made on assets before the marriage took place or while
the marriage was still ongoing need to be evaluated by attorneys. Sometimes
ill-drafted agreements leave loopholes that your spouse’s lawyer
can exploit. So, it is advisable to ensure the contracts haven’t
left any of your assets unprotected.
Alimony (Spousal Support)
If you and your spouse have a similar income, it is unlikely either of
you will require
spousal support. However, if one spouse makes significantly less than the one with high
net worth, the court may award the spouse with the smaller income some
amount of alimony for a period of time.
In some cases, a spouse with high net worth may try and spend excessive
amounts of money, particularly if it’s obvious the marriage is coming
to an end. This spending is usually an effort to avoid giving a spouse
more income or more share of the marital assets. However, this can often
backfire. Courts will often punish spouses who waste marital funds by
requiring them to provide their spouse with the equivalent of half of
what they spent in excess. For example, if a spouse spends $20,000 wastefully,
he or she will have to pay at least $10,000 back to his or her spouse.
High-asset divorces have a lot at stake. Some spouses might try to hide
extra funds from the divorce proceedings in offshore accounts. This is
illegal, however, and can be found out by hiring a forensic accountant
to investigate a spouse’s financial records.
If there ends up being a transfer of assets during a divorce, it almost
always involves tax consequences. You and your divorce attorney should
collaborate with an accountant to ensure any assets transferred are taxed
as little as possible.
The cost of a
high-asset divorce will likely be high, mostly as a result of disagreements between the spouses
and the investigation into any high net worth individual’s financial
records. If you are a high net worth individual and you initiated the
divorce, you might have to pay some amount of your spouse’s attorney’s fees.
To learn more about what to expect during a high-asset divorce, talk to
one of our Illinois family law attorneys. At
Wakenight & Associates, P.C., we understand how stressful divorce can be. Our lawyers try to make your
experience as easy and stress-free as possible. Let us see what we can
do for you.
Contact us by phone or fill out our online form to schedule your free case consultation
today. We look forward to working with you.