Facing a high net worth divorce in New York? Here are 5 ways to protect your assets
Divorce can be expensive, but when you have a substantial number of assets at stake, it’s normal to be worried about more than just the cost. Depending on each spouse’s financial circumstances, you could lose a lot more than court costs and attorney’s fees.
New York is an equitable distribution state, meaning that if you and your spouse cannot come to your own agreement, then the courts will distribute marital property in a way that is fair and equitable. This could result in a significant amount of your assets being awarded to him or her. The steps below can help you retain the property and finances you need to begin the next phase of your life.
Review any prenuptial and postnuptial agreements
If you and your spouse have a pre- or postnuptial agreement in place, then take time to review it every few years or when your personal assets or the marital estate substantially increase in value. When everything is properly addressed in a fair agreement, you stand a better chance of protecting all or most of your assets if the marriage does end in divorce.
Hire valuation specialists
One of the biggest mistakes you can make in a high net worth divorce is fail to have expensive assets and entities like real estate, a business, or professional practice professionally valued before settlement negotiations begin. It’s rare that a judge will have an accurate idea of what this property is worth, so if a value is not assigned, your spouse could receive more of your hard-earned assets than they should have.
Hire a forensic accountant
Forensic accountants specialize in uncovering the sources of various funds. In many marriages, spouses will share bank accounts and other financial instruments, making it challenging to determine which funds belong to whom for the purposes of division. Hiring a specialist will make it easier to ascertain how much money was contributed by each spouse.
Minimize your tax liability
Transferring valuable assets will nearly always result in tax consequences to one or both parties. Mitigate your tax liability as much as possible by having your attorney and accountant work together to strategically structure asset division.
Watch for dissipation for marital funds
When a high net worth marriage collapses, it is not unusual for the lower earning spouse to withdraw significant amounts of cash or go on a spending spree before all assets are finally divided. Many do this out of spite, to leave their spouse with less. If you notice a lot of money disappearing from joint accounts, notify your attorney, as the amount could count toward your spouse’s final settlement.
Dividing a marital estate in a high net worth divorce is tricky, but failure to properly prepare for the distribution process can make it even more challenging. That is why it is important to consult a New York family law attorney with experience in handling such divorces, so that you leave the marriage with everything you are entitled to, not less. The attorneys at Eskin & Eskin, P.C. have more than 40 years of combined experience and offer free consultations. They can be reached at 718-402-5204. Their office is located steps from the Bronx County courthouses. Visit www.EskinAndEskinLaw.com to learn more.
