Every divorce involves a division of assets. In some cases, a couple may have limited funds and no real property. Even though every divorce is painful, high asset divorces remain more complicated. High net-worth couples may have extensive stock portfolios, 401K’s, expensive real estate, businesses, fine art, jewelry, professional practices, numerous cars and extensive savings. Sometimes one spouse may attempt to “hide” assets from the other spouse in an attempt to lower alimony or child support payments. For that reason, it is imperative to hire an experienced attorney to navigate your high asset divorce.
High asset divorces involve a variety of issues including:
- Finding hidden assets
- Determining appropriate alimony
- Determining adequate child support
- Protecting reputation of business
- Evaluating estate worth
- Protecting a famous client’s reputation
- Determining debt responsibility
High net worth couples possess expensive assets. Their entire estate must be evaluated by professionals. In a high asset divorce expert testimony is provided by: certified public accountants (CPA’s), real estate appraisers, and business appraisers. Additionally, notarized documents (explained later) must be provided which show income, debts, credit card information and loan accounts.
Michigan is NOT a community property state where property is split 50-50. In Michigan, a Judge may divide property based on what’s fair. Basically, the Judge will look at all the circumstances in the divorce case and decide how to split the property. One important consideration involves which parent has custody of the children. This factor may influence the ability to remain in the marital home with some financial considerations attached. An experienced attorney will help you navigate the complicated divorce laws regarding division of assets.
Marital Property or Separate Property
In Michigan, any property or assets you attained while married is considered “marital property.” This includes: money in a pension plan, a 401K, real estate acquired after marriage, all business profits gained after marriage and all savings. The only exception is inherited property. However, if you inherit money and place it in a joint account with your spouse, it now becomes part of “marital property.” If you inherit money or property and keep it in your name only, it is considered separate property. A Judge only considers marital property when dividing assets. So, inherited money, property or assets that remain in your name are not included in property division.
Marital Property Division Factors
Marital property is divided in divorce proceedings. A Judge looks at numerous factors when determining how to divide assets including:
- Length of marriage
- Age of spouses
- Spouses’ financial needs and ability to work
- Spouses’ earning potential
- Spouses’ conduct
- Age of children
- Which spouse gets the home
Recent Michigan Supreme Court Rulings
The Michigan Supreme Court revised three Michigan Court Rules effective January 1, 2020. The updated rules should reduce some stress regarding the exchange of financial information in all divorce cases. The first change, MCR 3.206(C) states that each spouse has 28 days to fill out a Domestic Relations Verified Financial Information Form. This form must be notarized and you must include supporting documentation. Some documentation required may include: pay stubs, loan account information, credit card statements, bank account information and tax returns. It’s vital to meet with your attorney immediately for assistance with this form.
The second law, MCR 3.201(C) deals with interrogatories. Couples are now limited to 35 of this type of formal discovery. This new limit should keep costs down and speed up the divorce process.
The third revision by the Michigan Supreme Court, MCR 3.206(D) involves attorneys’ fees for spouses who receive numerous discovery notifications. Your attorney will guide you through these new statutes and explain them if necessary.