Is divorce in Michigan different based on your net worth? Are there special considerations to keep in mind if you have a high net worth?
These questions will be explored in today’s blog. We want to look at the specific things those with high net worth need to keep in mind when considering filing for divorce. We also want to emphasize the need for a Wayne County divorce attorney when you are divorcing, regardless of your net worth.
What Does High Net Worth Actually Mean?
When speaking of high net worth, we typically mean having valuable property. Specifically, you may have a home that is worth over $1 million, or high value investments. You may have come by this by way of your work, inheritance, or other means. The wealth accumulated could have been a result of both spouses or perhaps only one. Either way, there are many different factors that come into play with high net worth and those become especially apparent when in the midst of a marriage.
What is a High Net Worth Divorce?
“High net worth divorce” means when a couple who has a lot of money or valuable things decide to end their marriage. Even though they split up in the same way as other couples, it can be trickier because they have more things to divide. Sometimes, they might have a prenuptial agreement made before or even a postnuptial agreement about who gets what. But even with these agreements, there can be disagreements. If you’re in Michigan and going through a high net worth divorce, it’s super important to have a good lawyer who knows about this stuff to help make things fair.
Common Issues to Consider in a High Net Worth Divorce
In “high net worth divorces,” where couples have a lot of money or valuable things, there are special things to think about:
1. Figuring Out Who Owns What
- Is the property owned by both or just one person?
- Did they make an agreement before or after marriage about their property?
- Did one person own the property before they got married?
- Did one person get the property as a gift or inheritance?
- Was the property kept separate or mixed together?
Each situation can be different, so other factors can come into play.
2. How Much Is Everything Worth?
Figuring out the value of things can be hard. Experts and appraisers help find out how much property is worth. They look at papers, do research, and make a report about it.
Sometimes they have to explain in court how they determined the value. It’s tricky because things like company shares or businesses can change in value.
3. Taxes
Sharing valuable things can affect taxes. Sometimes, a tax expert helps to see how different ownership arrangements will impact taxes. The way taxes work can influence how couples split their things in the divorce.
4. Alimony (or Spousal Support in Michigan)
Sometimes, one person needs financial help after the divorce. This happens most often when one spouse focused on making money and the other took care of the home and kids. They can agree on how much and for how long, or the court will decide.
Uncommon Situations in High Net Worth Divorces
In Michigan, divorces are filed as no-fault divorces. This means that the marriage is irretrievably broken or the couple has irreconcilable differences. This does not mean that fault cannot be taken into account when calculating spousal support or dividing property. Issues like abuse or adultery may be considered by the court when determining the distribution of assets, including what percent of the marital property each should be awarded and in determining support. In addition, if the spouse is able to show that the adulterous spouse wasted marital property on and during the affair, then the value of that waste should be included in the marital estate when determining the value or amount of marital property.
Do High Net Worth Divorces in Wayne County Take Longer?
High net worth divorces can take a fairly long time to complete. This is mainly due to the amount of documentation and other paperwork that must be reviewed to determine exactly how much value the property owned by the couple is worth. CPAs and property valuation experts may be needed to review the numbers and determine asset values. Also, once that value has been established, it is likely the parties will argue over the division of the property.
There are other factors that can affect the duration of a high-asset divorce. Sometimes, accusations or suspicions of hidden assets arise, and that may take some time to investigate and discover. In other cases, prenuptial or postnuptial agreements can help make the process go smoother or hold it up, depending on any challenges to the terms and conditions or overall validity of the contract.
In sum, for a high net worth divorce, you could be looking at a minimum of one year before the divorce is finalized. In some cases, it can take years. A divorce lawyer in Wayne County with experience and resources will know what to look for and how to move the divorce along with minimum hiccups. The Downriver divorce lawyer you hire can have a real impact on your divorce and your financial interests.