Partner
If you’re considering divorce, you may have all sorts of questions. How much will it cost? How long should it take? Do you qualify for alimony? The list goes on. However, one of the biggest concerns most couples have is how high-value assets like real estate will be distributed.
New York is an “equitable distribution” state, which means that all belongings are divided in a way that a judge considers fair, though not necessarily equal. Since the court examines the greater economic circumstances of each partner, they consider a lot of different factors when determining who gets what.
Here’s a breakdown of what courts look at when handling high-value property divisions in New York.
Marital Property vs. Separate Property
Before deciding how to split your property, the court will designate each item as marital or separate. Marital property is anything that you both own. For example, a home with both names on the title or a business you both invested in is considered marital property. In most cases, marital property is something that you obtain during the marriage.
Conversely, separate property is something that belongs to just one spouse. This could be a car purchased before the marriage or an inheritance given to just one partner.
It’s important to know that in some situations, items owned before marriage can be considered marital property. A common example is when one partner owned a home before getting married, but their spouse made mortgage payments throughout the marriage.
How do courts divide high-value assets during divorce?
Since New York is an equitable division state, the monetary value of each asset isn’t the only thing the court will consider when splitting your assets during divorce. They will also consider a lot of circumstantial factors, including the following.
Careers/Incomes
For many couples separating, there may be a big difference between each partner’s annual salary or earning potential. One spouse may have stayed home to take care of children, which would significantly influence their career.
When dividing assets, the judge will examine these factors to make sure both partners have a fair outcome that provides them with the funds and assets they need to lead separate lives.
Financial Situations
In addition to their current careers, judges may also consider things like individual debts, retirement accounts, and more. They want to fully understand your financial situation so they can divide the remaining assets more equitably.
Number of Assets
If a couple has several high-value assets, the court will rely on circumstantial factors to fairly divide them. However, it’s a bit harder if a couple has just one home. In this situation, there are three common solutions:
- Selling the house and dividing the earnings
- Buying out your partner and refinancing in your name
- Allowing one spouse to live in the home and take care of the children until they are adults
Each of these solutions comes with benefits and drawbacks. If you are worried about which partner will get the house during a divorce, consider speaking with a divorce attorney to learn more about your options.
Dividing Assets Through Accounts
There may also be complexities in dividing investment accounts or savings accounts as well as various pre-tax retirement accounts. Likewise, the value of stock options, RSUs, equity and other incentive compensation requires special attention.
Distributing various parcels of real estate, including rental homes or commercial investment property, which may be held in LLCs or other entities, also requires consideration of the capital gains as well as income and cash flow consequences.
All of these issues require an experienced attorney to advise you appropriately of your rights and opportunities to craft a fair and equitable agreement.
Why work with a divorce attorney?
No part of divorce is easy, but dividing high-value assets is one of the most stressful steps. Though the court has a system for helping couples equitably split those assets, it’s still possible to come up with a solution on your own. A divorce attorney can help mediate conversations with your spouse to help you reach an amicable solution.
Whether you’re just considering divorce or are already somewhere in the process, the family law attorneys at Aiello & DiFalco, LLP, are prepared to help. Our team in Garden City, NY, is committed to providing compassionate representation backed by years of experience. If you’re ready to schedule your free consultation, call us today!