The term “high asset” divorce is used when a separated couple has a number of jointly owned assets that are of significant value. What’s not clear is just exactly what a couple needs to have for their divorce to be considered high asset or high net worth in nature.
Is there a definition of a high asset divorce?
There is no set definition of what constitutes a high asset divorce but it’s generally thought to be relevant in divorces where the combined assets total at least $1 million.
More importantly, it’s a term used to describe a situation where the financial position of the divorcing couple is more complex due to the significant amount of property, investments, and money they have between them.
Some of the issues that divorcing couples with a high net worth find themselves facing include:
- valuation (and division) of property
- determining community property from separate property
- Undesirable tax implications
Which assets are taken into account during a divorce?
- Property comprising the marital residence as well as any additional assets, such as vacation homes or investment properties. This could include assets acquired before or after the marriage.
- Real money in the bank as well as investments like stocks, shares, and bonds. It also covers any bonuses or payments made in relation to performance that was received through employment.
- 401(k) plans, private pensions, and any military retirement benefits are examples of retirement funds.
- either separately or on behalf of each party, business ventures. This could be a PLLC or an S corporation, among other types of entities.
As a divorcing couple with a high net worth, there are considerations that can make the process more difficult. Enlisting some legal guidance in the area gives you the best chance of protecting your assets and navigating the process.