Divorce is difficult for all couples. There are so many emotions in play—anger, disappointment, fear. Many people don’t know how to tell their children or even their families.
But splitting up is often more complicated for people with a high net worth, which generally means couples with assets and income over $1 million. There are more assets to divide, and some of them might not be in the state of Ohio. Also, a judge will take a closer look at whether one spouse is deserving of more of your assets, which throws another wrench into the divorce proceedings.
If you have a high net worth, you need an attorney who understands the unique complications these types of divorces can bring. Contact Lawrence Law Office today.
Ohio has created child support guidelines that judges use when calculating support. These guidelines consider many factors, including each parent’s income, and have taken a lot of the debate out of child support determinations.
However, the guidelines only apply to parents who earn less than $336,000 in combined income. If you earn more, then a judge will not use the guidelines when setting child support. This makes calculating support much less predictable and gives judges considerable discretion.
Child support in high income cases is complicated because one parent might try to get additional support for their own lifestyle. Child support is designed to support the child, but when a judge works “off guidelines,” then anything can happen.
Equitable Distribution of Marital Property
Ohio law requires the equitable division of marital property. This is an area ripe for dispute in a high net worth divorce. We have seen:
- Issues regarding whether property is marital or separate
- Disagreements about whether a spouse has fully disclosed all properties he or she owns, even those out of the state or country
- Conflicts over what property each spouse will walk away with
The more assets you have, the longer these disagreements can last. Some spouses like to argue about every last piece of property, which can make a high net worth divorce a time-consuming affair. You need a lawyer who understands how to make sure a divorce is always moving forward.
Also, a judge can make a “distributive” award if one spouse has been hiding assets, so each side has an incentive to investigate whether a full and fair disclosure of assets has been made. These investigations can easily get out of control if an attorney does not stick up for his or her client’s rights.
Issues Regarding Business Interests
It isn’t unusual for individuals with a high net worth to own part of a business. If you only own stock in a publicly traded company (like Microsoft), then there will probably be no issues since the value is easy to calculate. But if you own part of a small business, or if you are a sole business owner, then many complications can arise.
First, you need to determine how much of the business is considered marital. This is not easy if you started the business before getting married. Your spouse might argue that the increase in value over the course of the marriage should be considered marital and subject to equitable distribution.
Next, you need to properly value the business. Valuation issues often require the help of an expert. The value assigned to the business matters enormously. If the business is overvalued, you might not get as many marital assets as you expect.
Dividing a business is also complicated—and unrealistic in many situations. You need to think through what you will do if the judge gives half of the business to your spouse. Options include buying out your spouse’s interest, selling the business, or trying to run the business together.
In many high net worth marriages, one spouse makes much more than the other. As an example, a husband might have a successful medical practice while his wife works a lower-paying job at a non-profit. A divorce could leave the lower-earning spouse unable to maintain a comfortable lifestyle, so he or she could ask for spousal support.
Spousal support is almost always contested, and some spouses ask for exorbitant amounts of money. Spousal support (also called alimony) has enormous tax consequences for each spouse, which also must be considered.
Not every couple has a prenuptial agreement, but some might. These agreements add another layer of complexity to the divorce. Either spouse might challenge the prenuptial agreement or wish to enforce it.
Get Help with Your High Net Worth Divorce
Lawrence Law Office has helped many high net worth individuals navigate the state’s divorce system. We are extremely proud of our knowledge and ability to resolve issues efficiently. Please contact us today to schedule an initial consultation.