Saying divorce is difficult is a gross understatement. When a couple must divide extensive assets, a potentially straightforward process can become messy.
Individuals with a high net worth can look for the following pitfalls to avoid major regrets.
Not taking stock of assets and liabilities
All property, accounts, investments and debts a couple accumulates together are marital property and up for an equitable division according to Michigan laws. A miscalculation can prove costly. At the same time, the court will view an attempt to hide assets as fraud, so honesty avoids expensive penalties.
Not discovering the tax implications
Each individual should consider how the split of property can affect taxes. For example, the sale of the marital home can take a couple over the exemption threshold for capital gains. Any negotiations can ensure that each person pays a fair share of the tax liability.
Not considering mediation
A spouse might prepare for a fight and start filling up with legal ammunition for a battle. A contentious attitude from the start usually does not serve anyone well. Crafting a deal together could help everyone get most of their wants and shorten the process. Mediation does not work in all cases, but it should be an option on the table.
Not doing the math on post-divorce lifestyle changes
Even if a person’s income remains high after a split, some adjustments will be likely. Determining what factors are most important and what courts are likely to grant can improve one’s strategy. A judge may be more willing to accede to a person’s requests when the numbers match up and the individual displays reasonableness.
High assets add new wrinkles to the complex challenges of divorce. Carefully considering all the options can increase the odds of achieving a more favorable deal.