The Most Important Question About Wealth During Divorce
My earlier blogs spoke about the financial considerations of divorce such as retaining the marital home, tax consequences and the business of dividing complicated assets.
During divorce, the following points drive the process of equitable property distribution in New York State:
- Property is divided equitably, not necessarily equally by courts in our state. The court impartially examines factors that bear on the lifestyle, economic needs and earning capabilities of both parties when making property awards.
- Marital property is composed of assets, wealth and debt acquired by a couple during marriage. Assets originally brought to the marriage but maintained or financed later through the marriage can be considered commingled and part of the marital estate.
- The expense associated with litigating the divorce, which can include not only the cost of each spouse’s respective counsel but the retention of experts to value assets of the marriage and testify in court with regard to their findings. Given the expense, limited time and resources of the court, pursuing satisfactory property division in a litigated setting is not advantageous for either party in a high asset divorce.
Despite the instability and unhappiness of divorce, it is essential for high net worth couples to recognize the most important financial question you both face — how do you retain your wealth? Working to discuss and divide assets outside of court gives both parties the financial security to move forward — without the chance of losing certain tax advantages when property division is determined by the court.
Alternative dispute processes like mediation, negotiation and collaborative law support private resolution of property division to the advantage of both parties. When you have high net worth, work with an experienced divorce firm in New York City and retain what you have worked so hard to build.