Spokane County High Net Worth Divorce Lawyer
Divorce is rarely easy, but when you have valuable assets or other complex financial issues, it is even more complicated. You need a lawyer on your side who understands the special circumstances of these cases, and knows how to protect your rights throughout the asset division process.
When couples with a particularly high net worth file for divorce, however, a whole new set of issues can arise. There are likely more complex financial situations, multiple sources of income, and multiple valuable pieces of property. Some pieces of property may be more difficult to assign a value to than others, and a mistake in asset valuation can land one party with terms that turn out to be much less favorable a few years later than he or she thought at the time the divorce decree was entered.
30 YEARS OF EXPERIENCE
LARGEST FAMILY LAW FIRM IN SPOKANE
These added issues increase the incentive to litigate the divorce for longer, but they don’t alleviate any of the other issues that less-complicated divorces entail, like child support, child custody, visitation, or finding new living arrangements. In other words, the more wealth a couple owns, the higher the stakes and the bigger the headache. This means that in the context of a high net worth divorce, obtaining the best possible professional advice, including a top divorce attorney as well as expert accounting, is crucial to your long-term financial health.
Spokane law firm Crouse Erickson represents parties in high asset and complex divorces, ensuring clients retain their share of hard-earned assets and safeguarding their financial future. If you are facing a high asset divorce or have other complex financial issues that may complicate your division of property in Spokane, you need our experience and skill. Call our office at 509-624-1380 today, and let one of our Spokane high asset divorce lawyers go to work for you.
What Is Considered a High Net Worth Divorce in Washington State?
As a general rule, if you or your spouse own more than $1 million dollars in assets, your divorce is considered a high net worth divorce. A married couple’s wealth doesn’t affect the process of filing for and finalizing a divorce at all, but it does heighten the stakes, both because there is simply more money and property on the line and because any specific division of property will have an impact on the former spouses’ tax liability as well. These considerations mean the divorce is likely to take longer to finalize and may involve more experts, such as accountants or economists.
A high asset value divorce involves parties who have a large net worth. They often have multiple homes, estate plans, high income, stock options and stock plans, and other high-dollar investments. Separating these assets is more difficult than in a case where the partners only share a checking and savings account, and perhaps a home.
In many of these cases, there is the added complexity that one partner earned most of the income while the other took care of the children or worked in the home only. This type of situation may lead to additional conflict or disagreement between the parties, even though the law is fairly clear about asset division.
We can protect your financial interests, work to prevent you from having to pay unnecessary taxes, and help you ensure a stable financial future.
What Are the Issues Associated with High Net Worth Divorce?
A number of legal issues arise in the context of high-value divorces that are less likely to come up when there is less total wealth subject to equitable division when a judge finally enters a decree making the divorce final. These include:
- Delineating separate property from community property. Washington is a community property state, which means all property acquired by either spouse while a couple is still married is equally owned by both of them. Separate property is not shared and includes anything that a spouse owned before the couple got married as well as any proceeds, rents, or profits that a piece of separate property has generated. While both separate property and community property can be divided and awarded to either spouse at the end of a divorce, a judge will consider how much separate property each spouse has when deciding on what constitutes a “fair and equitable” split. High net worth individuals are likely to have significant separate property in the form of inheritances or trust funds, so it is vital to accurately account for what is a piece of separate property and what is not.
- Expert appraisal. High net worth couples are more likely to own property like real estate, jewelry, art, and antiques, that require expert appraisal. Without reliable information about the value of each piece of property at issue in a divorce, a judge could order, or a couple could agree to, a division of assets that turns out to be far from “fair and equitable.”
- Professional practice valuation. Washington law recognizes that professionals such as physicians, dentists, accountants, and lawyers, build up a professional reputation over time and that this reputation has real value. That value can be included in the list of assets divvied up at the end of a marriage. However, it can be difficult to assign a precise value to years of professional goodwill. For this reason, both owners of professional practices and their spouses seeking divorce are often best served if they seek expert testimony to establish the value of the practice.
- Tax liability. Splitting a high net worth couple’s complex portfolio of assets may involve some complex transactions to liquidate those assets and divide them up. Depending on how these transactions are carried out, they could create a tax burden that eats into each party’s final award significantly. In light of this, it is crucial not only to understand the value of all of a couple’s assets and to come to a fair division of them but also to be mindful of tax law throughout the entire process so neither spouse is stuck with an unexpected but avoidable tax bill.
- Foreign or out of state investments. High net worth individuals more often own assets in other countries or property in other states, such as a vacation home. Distributing these kinds of assets in a divorce may involve some knowledge of property law in jurisdictions outside of Washington.
Do High Net Worth Divorces Take Longer than Other Divorces?
Typically, yes. Individuals with high levels of wealth tend to have more complicated finances. They may receive an executive compensation package, they likely own multiple investments, and they may hold stock in a public or closely-held corporation. In addition to these financial considerations, high net worth individuals still must sort out more common but no less crucial issues like child residential schedules and child support. There is simply a long list of issues to sort through in high net worth divorces, so they tend to take longer.
High net worth divorces may be more likely to go to trial as well. Many married couples avoid trial because the time and expense of extended litigation means that it’s in their best interest to settle relatively quickly. This calculus can change when a party has more resources at their disposal, though of course, the decision of how long to litigate is always up to the parties, not their lawyers.
What is your experience with high asset divorces or complex financial situations?
If your case involves high assets or complex financial situations, it is paramount to find a lawyer who handles this type of case frequently. Very few attorneys actually have extensive experience with high asset cases or those involving business and professional practice valuations. There are a number of factors in play in a high asset divorce that go far beyond identifying and valuing the assets in a typical divorce. David J. Crouse is one of the most experienced attorneys in Eastern Washington in high asset, business valuation, and professional practice valuation cases.
What is Washington State’s law about property division?
Washington has a legal mandate in place calling for an equitable split of all property and assets gained during a marriage. We are known as a “community property” state. In short, all income earned by either spouse during the marriage is typically community property belonging to both partners.
This means that even if one partner earned high wages during the marriage and the other did not, they still share these assets. Washington State law does not question each partner’s financial contribution but instead assumes they both contributed. Since we are an equitable distribution state, the Judge can award one party more than 50% of the assets. A party could even receive 60% or 70% of the assets. This disproportionate award is always made in favor of the spouse who has a disadvantaged earning ability.
Why is valuation important in a high asset value divorce?
While community property assets are divided, and in some cases, separate property assets can be divided by the court too, this requires knowing the value of all of your assets. In a high asset or complex financial situation, this is not as easy as it may seem. Often, we must hire independent appraisers, forensic accountants, and other professionals. We have also worked with wine, fine furnishing and art appraisers and other experts to place a fair value on clients’ assets.
Some of the assets we regularly value include:
- Family homes
- Vacation homes
- Investments, including stocks and real estate
- Retirement accounts
- Pension plans
- Cars, boats, and other vehicles
- Valuable collections, including art, wine, instruments, and antique furniture
Ensuring the experts put an appropriate value on your assets relies on enlisting the help of experienced appraisers and skilled accountants. Because of our network of trusted professionals and expert witnesses, we can ensure you receive fair valuations for all property and other assets.
How do businesses and other private practices complicate divorce?
Even if you spent countless hours and hundreds of thousands of dollars building your business if you started it after you got married (or if your spouse helped you build your company), your spouse will have an interest in it. This may also be true even if you started the business long before the marriage.
Before courts will order a sharing of the business value, you obviously must first determine the business’s value. This is a complex process and is based in large part on a CPA’s subjective opinion. When performing a business valuation, an appraiser will consider the company’s finances as well as the company’s goodwill. Goodwill is the intangible value of the company (e.g., the business’s relationship with the community, what customers think when they hear the name, etc.).
If an attorney is not extensively experienced in business valuation technique and procedure, you may miss many of the subjective valuation methods that can be used to detrimentally impact the value you receive, while substantially enriching your spouse.
We work with business valuation experts to determine a fair value for your company. This will give you the information you need to make an informed decision. In some cases, you may be able to buy your spouse out of the business, trade his/her half for another asset of similar value, or you may decide to sell the business and split the profits.
Where can I get help with a high asset divorce or complex financial issue in Spokane?
David J. Crouse has extensive experience in business and professional practice valuations, expert preparation, and trial. If your case involves high assets, significant business interests, or professional practice, we can help you.
The more is on the line, the more important it is for your financial future and your peace of mind that you have a trusted legal advisor by your side in all stages of your divorce. The experienced advocates at David Crouse & Associates, PLLC are prepared to give you top-flight legal advice, to recruit the right experts, and to guide you to a winning strategy in your high net worth divorce proceeding, up to and including a trial. Contact Crouse Erickson about representation in your dissolution action.