Navigating a High-Asset Divorce in North Carolina: What You Need to Know
- Navigating a High-Asset Divorce in North Carolina
- Is My Divorce a High-Asset Divorce?
- How Assets Are Divided in a North Carolina Divorce
- How Can I Protect My Assets During a High Net Worth Divorce?
- Other Issues in a High-Asset Divorce
- Contact Myers Law Firm for the Experienced Advocates You Need During a North Carolina Divorce
Navigating a High-Asset Divorce in North Carolina
Each divorce process is unique, and so are the legal issues that surround it. But if there’s one general rule that holds across most divorces, it’s that the more money and assets that are involved in a divorce, the more complex and expensive the process tends to be. High-asset divorce cases can easily become complicated, lengthy, and stressful for both spouses.
Is My Divorce a High-Asset Divorce?
There’s no strict definition for a high-asset divorce, but in general, a high-asset divorce is one that involves a significant total value in assets. Spouses in a high-asset divorce often have total household incomes exceeding $250,000 per year, and these divorces often involve high-value assets such as (but not necessarily limited to):
- Real estate holdings, sometimes including multiple homes
- Multiple cars or other vehicles
- Family-held or jointly owned businesses
- Retirement and investment accounts
- Inheritance/trust interest
- Expensive/unique collections such as valuable artwork and jewelry
On one hand, high-asset divorces are not totally different from divorces that involve fewer assets and less money. Wealthy or high-earning couples still need to resolve the same fundamental legal issues that every divorcing couple does, including child custody, child support, spousal support, and property division. But the way these processes play out—especially when it comes to the length and complexity of negotiations and legal proceedings—can look very different during a high-asset divorce settlement.
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How Assets Are Divided in a North Carolina Divorce
In a North Carolina divorce, property division is based on a philosophy of “equitable distribution,” which means that the court starts out with the presumption that the spouses are entitled to an even 50/50 split of any marital property that was acquired from the date of marriage through the date of separation.
However, not all of the assets owned by spouses are necessarily marital assets. During the divorce process, the court will classify all the assets owned by either or both spouses into two main categories:
- Separate property is property that one spouse either owned independently before the marriage or received as a gift or inheritance during the marriage. Note that gifts and inheritances must be intended for only one spouse to be considered separate property. Also, assets purchased with separate property remain separate property if certain parameters are met.
- Marital property is all the non-separate property that either spouse acquired from the time they got married through the date of separation. Usually, it doesn’t matter if a property or asset is only listed in the name of one spouse. If it was acquired during the marriage and is not separate property, it’s marital property.
There’s also a third category of property, divisible property, which includes any property that either changes in value after the date of separation or was earned before the date of separation but not received until after separation. This category is necessary because property can change hands or change value between the date of separation and date of distribution—especially a high-asset divorce that takes time to resolve. Like marital property, divisible property is subject to equitable distribution.
Some other states apply a different standard called “community property.” If you’ve read about this standard, just know that it isn’t relevant to the division of property during divorce proceedings in North Carolina.
What Factors Can Affect Property Division in North Carolina?
So, we know that the court starts out with the presumption that all marital and divisible property should be split 50/50 between the spouses—but we also know it can’t be that simple, or there would be no fighting over assets in any divorces!
In reality, the 50/50 split is just the starting point for negotiations and arguments in the divorce. Each spouse can make arguments before the court explaining why a 50/50 split would be unfair and why they deserve more than a 50 percent share of any assets. And, in addition to arguing for an unequal split, either spouse can produce evidence to show that an asset should be considered their separate property instead of marital property.
How Can I Protect My Assets During a High Net Worth Divorce?
When you’re facing a complex, high-asset divorce, things can become overwhelming quickly, and it may be hard to know where to begin. The first step—which your attorney can help you with—is to build a complete, accurate picture of all your household and business property: what it is, what it’s worth, where it is, and who owns it.
And when we say all the household and business property, we mean all the property. Even if an asset was acquired outside the marriage and eventually won’t be part of the property distribution process, your attorney, the court, and your spouse’s attorney all need to know about it.
Some of the key steps you can take to build an inventory of property include:
- Make a written inventory and take pictures or make copies of all valuable possessions and financial documents, including:
- Insurance policies
- Financial accounts, including bank and retirement accounts, as well as investment portfolios
- Estate planning documents
- Tax returns
- Billing, receipts, banking records, tax documents, and any other available financial records for any household or jointly owned businesses
- Categorize all possessions and assets as one of the following:
- Marital property (obtained jointly during the marriage)
- Separate property (owned prior to marriage, or was inherited or received as a gift specifically intended for one spouse)
- For all separate property, gather proof or documentation that can show the asset was owned prior to the marriage or received by one spouse as a gift or inheritance
- For any valuable personal property that you own, secure it, and have it professionally appraised to determine its value
- Change the beneficiary on any of your accounts as needed
Again, if this sounds like a lot to deal with, don’t worry—an experienced divorce attorney should be able to guide you through every step of the process and answer any questions you have along the way.
Can I Hide Assets During a Divorce?
Absolutely not. You should never try to conceal assets during the equitable distribution process. Hiding assets in a divorce is against the law and can lead to consequences including:
- Court sanctions and penalties
- Being forced to pay the other spouse’s legal fees
- Higher alimony payments
- Being held in contempt of court, which can lead to jail time or even a prison sentence
Unfortunately, the risk of severe legal consequences isn’t always enough to overcome greed, especially when large amounts of money are involved. So, it’s not unheard of for spouses to try to hide assets or accounts during a high-asset divorce.
If you suspect your spouse is hiding assets, it’s very important to let your lawyer know right away. Hiding assets is harder today than ever, and an experienced high-asset divorce lawyer should have access to forensic accountants or other expert investigators who can uncover hidden assets. These specialists can examine financial records and trace money across accounts, transactions, and financial institutions to reveal the full and accurate picture of the marital property in a divorce.
Other Issues in a High-Asset Divorce
Other divorce-related issues besides property division can also become more complex in a high-asset divorce. For example, if the divorcing spouses’ combined monthly gross income is more than $40,000 (as of January 2023), the North Carolina child support guidelines don’t go high enough to set a default amount of support. When this happens, the amount of child support depends completely on negotiation between the spouses and, ultimately, the decision of the judge who handles the child support case.
This example is just one of many ways in which a high-asset divorce can take you into “uncharted territory” where generalized legal advice won’t apply to your situation. Long-term alimony can also become a contentious issue in high-asset divorce cases.
If you’re currently involved in or facing the prospect of a high-asset divorce, there’s an enormous amount at stake, and any mistake can be incredibly costly. In this situation, you should contact an experienced divorce attorney who has handled high-asset divorces before and can begin building a legal strategy to protect your rights and best interests.
Contact Myers Law Firm for the Experienced Advocates You Need During a North Carolina Divorce
The attorneys of Myers Law Firm have decades of combined experience handling all major family law issues that surround the end of a marriage, including alimony, child custody, child support, property division, and divorce. We’ll always treat you with compassion but also fight relentlessly to protect your rights and best interests.
If you need help with a family law matter in Mecklenburg County, call our offices at (888) 376-2889 or fill out our online contact form today to schedule your initial consultation.
The content provided here is for informational purposes only and should not be construed as legal advice on any subject.