High Net Worth Divorce: Protect Your Interests

Divorcing couples with substantial assets and income have additional considerations about spousal maintenance, property division, and child support. A high-net-worth divorce requires you to work with a divorce attorney who is experienced in asset valuation and negotiation. Robinson & Henry family law attorneys will protect your best interests and wealth while ensuring all sides receive a fair outcome.

Special Considerations in a High Net Worth Divorce

Determining Alimony in High Asset Divorce

In 2018, Colorado legislators passed statutory guidelines to give family courts some direction on how to award alimony, known as spousal maintenance.

Apart from the duration of the marriage, the most influential determining factor of an alimony payment is income. Colorado Revised Statute § 14-10-114 calls for courts to use gross income to calculate alimony. That gets tricky for high-income earners because Colorado’s alimony formula does not account for couples with a combined annual gross income exceeding $240,000.

In these cases, courts consider other factors in deciding an alimony award, including:

• the recipient spouse’s ability to meet their own needs
• the paying spouse’s ability to pay the alimony and meet their reasonable needs
• all sources of each spouse’s income
• the lifestyle enjoyed during the marriage
• whether additional marital property could reduce or eliminate the need for spousal maintenance

As mentioned above, another determinant is how long you and your spouse have been married. The court will also consider whether one spouse was the primary earner while the other was not employed.

Calculating Child Support in High-Net-Worth Divorces

Colorado child support payments are based on the parents’ combined monthly gross income and how many children the couple has. The child support equation only supports up to a combined monthly gross income of $30,000. Like alimony, courts may deviate from the guidelines when income exceeds $360,000.

Account for all Your Assets

When significant assets are on the line, some people are tempted to hide them. This is illegal. Individuals who hide assets during divorce can face fines, jail time, and other financial sanctions for their actions. The court can also punish the offending spouse by awarding them a less favorable settlement.

The best way to protect your assets is to hire counsel experienced in handling high-net-worth divorce cases.

If you are concerned your spouse will try to hide assets talk with an attorney. Here are 10 Warning Signs Your Spouse is Hiding Assets.

A Complete Financial Disclosure

The financial affidavit is an inventory of all your marital assets and liabilities. In a high-asset divorce, a complete financial picture is critical to ensure you receive your fair portion of the marital property and a fair settlement. Individuals with a high net worth will need an attorney with experience identifying assets and debts.

Consider the Tax Consequences of Property Distribution

During property division, possessions and assets sometimes are distributed to the spouses, while in some cases those assets might be sold and the proceeds distributed.

For example, if the spouses own a home together, it might make more sense to sell the home and distribute the proceeds from the sale rather than giving the house to one of the spouses. When spouses are awarded particularly valuable assets during property distribution—such as real estate or a piece of fine art—there can be significant tax consequences.

Why are tax considerations so important? If we think about a hypothetical case in which a couple is getting divorced and Spouse A was the primary earner during the marriage. Spouse B really wants to keep the family home, which is valued at $1 million. If Spouse B is awarded the house during property distribution, then s/he will likely receive less in liquid assets. When it comes time to pay taxes on the distributed assets, it may be difficult for Spouse B to come up with the money.

A Divorce Attorney is Your Best Advocate for Your High Asset Divorce

If you face a high asset divorce, it is important to seek advice from an experienced Colorado divorce attorney. Call 303-688-0944 to begin your case assessment.