Legal Review: Why Divorces Involving High Net Worth Couples are Much More Complicated

By Family Law Attorney Galit Moskowitz of Moskowitz Law Group, LLC

Divorce is never easy, but when it involves a great amount of wealth, it becomes so much more complicated due to the amount of property that must be divided.

While each divorce is governed by the state it is filed in, there are some complexities anyone with a high net worth, and in the middle of a divorce, will face. In divorce, property is divided in a 50/50 split, or by equitable distribution.

Community states use the straight-down-the-middle formula while equitable distribution states will divide property up fairly, or justly. This does not always mean that it will be split equally, though.

In community states, dividing property evenly in a high net worth divorce is fairly simple, although it does have its own complications. In equitable distribution states, it is a bit more complex. For example, a judge may award one spouse $5 million and the other $10 million, as both amounts provide plenty for a spouse to live off.

“There are many factors judges across the country will take into consideration,” says Galit Moskowitz of Moskowitz Law Group, LLC. “But the one factor that any judge will weigh is the contribution of each spouse to their earnings. If one made the bulk of the income and was highly involved in a business that made most of that income and the other was not, the judge will likely award those with greater involvement more.”

However, complications will still be at play. One similarity all high net worth divorces have is that their assets are complex. It is not merely houses and cars that make up the assets. It is often stocks and shares in companies. When this is the case, those shares are sometimes divided equally.

In other instances, both spouses will co-manage the shares, which can often put investors and corporate directors of the companies at greater ease.

Another commonality in all divorces, no matter where they occur in the country, is that prenuptial agreements supersede any state property division laws. While a judge will still have to determine that a prenuptial agreement is fair and enforceable, whatever the couple outlined when they signed it is how their property will be divided in the end.

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