High-income and high-asset divorces often become more contentious and complicated than smaller, simpler divorces. Sharing more property with a spouse means that there is more for a couple to fight over at the end of their marriage. A higher standard of living during the marriage could also lead to significant concerns by a lower-earning spouse leading up to the divorce.
Familiarizing yourself with the community property laws in Texas is a good starting point as you prepare for divorce. It’s also important to identify assets that could complicate your divorce proceedings. What kinds of property could make property division harder to resolve?
Investment real estate holdings
Splitting up your marital home is enough of a challenge in a divorce. When you have multiple investment real estate holdings acquired during the marriage, the process becomes more difficult.
It can be costly just to establish the fair market value for each of the investment properties and even more difficult to propose a fair and appropriate way to divide their value during a divorce. They likely also represent some liability, between tax and insurance costs.
A business or professional practice
If one spouse finishes a professional degree or gets bit by the entrepreneurial bug during the marriage, there could be a business or professional practice included in the pool of marital property.
Valuing a business is a crucial step to dividing it in a divorce. Considering both the liabilities for the company and its likely future revenue will influence what is fair. The couple will also have to talk about a reasonable way to share the business, whether that involves splitting the ownership or just considering the business’s value when dividing other property.
Bonuses and benefits from work
Income is relatively easy for a couple to split, but many higher-earning individuals receive more than just a paycheck for their job. There could be stock options or an excellent health care plan that isn’t available on the public marketplace. Looking at bonuses, deferred compensation and employment benefits can be an important part when valuing the marital estate and creating a proposal for dividing the assets and debts.
Planning ahead to be crucial for those expecting to go through a high-asset divorce in the near future.
