August 29

High Net Worth Divorce in Texas

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In a high-net-worth divorce, several issues can turn an otherwise simple divorce into a complex web of litigation. Aside from complex child-related matters, a wide variety of high net worth financial aspects need to be identified, examined, and thoroughly addressed before a resolution can be accomplished.

Prenuptial Agreements
Real Estate
Closely Held Business and Professional Practice Valuations
Stock Options
Retirement Assets

Prenuptial Agreements

If you signed a prenuptial agreement before your marriage, you would have questions about what happens in your divorce and how your prenup will affect asset division. After listening to your situation and your objectives, our divorce attorneys will review your prenup in detail and discuss the impact that this will have on the resolution of your divorce matter.

When choosing legal representation, consider choosing an attorney whose practice is exclusively devoted to divorce and family law, with experience in high net worth divorce, rather than a general practice lawyer.

Consider the implications, for example. Working with a lawyer who generally does not handle complex divorce matters may not wholly understand ERISA rules related to prenuptial agreements.

Our divorce lawyers know that a prenuptial agreement may not override the distribution of an ERISA (Employee Retirement Income Security Act) plan. This means that even if you waived your rights to your spouse’s employer-sponsored retirement plan as part of the prenuptial agreement before marriage, you might still be entitled to a spousal percentage share interest of that same retirement plan.

However, this issue is a moot point if you signed an ERISA form waiving your right to future retirement benefits once the marriage occurs. This example highlights the need to ensure that your divorce lawyer is highly well-versed in the law, exclusively practices Texas family law, and regularly handles complex divorce matters.

Real Estate

Real estate is often one of the most significant assets in a marital estate. Whether your real estate holdings are comprised of a marital home, vacation home, commercial property, or investment property, you will need to determine what portion of the property is subject to equitable distribution and what portion, if any, is exempt from the division of assets.

Relevant factors involved in the distribution of these assets can include but are not limited to the date of the marriage, date of purchase, down payment amount, and source of the payments. For instance, if you acquired the property (or money to pay for the property) using an inheritance, gift, or bequest, your percentage share interest in the real estate could be impacted.

Once your real estate assets are appropriately identified, you will need to decide whether to retain or sell the property. After you agree on what to do with the property, our TX divorce lawyers will help you develop a creative solution to preserve your interest in the assets.

Valuation of the property in the form of comparative market analyses and appraisals may be required before the settlement is completed. If a valuation or decision as to the disposition of the property cannot be reached, then the courts will need to intervene.

Closely Held Business, Partnership, and Professional Practice Valuations

As a general rule, unless your divorce is amicable, a Texas divorce case that involves the ownership of business assets will typically take longer to resolve than a divorce where no business assets are involved. For example, if one spouse owns and operates a business, then the business will probably require a formal valuation and report.

In this case, forensic accountants and actuarial experts are either jointly or individually retained to determine the business’s fair market value. The valuation process will typically include a thorough inspection of:

the business site
records
books
general ledgers
payroll registers
receivables
machinery
inventory
real estate
client lists
partnership interests
enterprise and
goodwill.

Also, if you owned the business before the marriage, it will need to be determined if the business is a marital asset. We will need to calculate your spouse’s shared interest in the business if it is.

Whether you are looking to sell the business or continue to run the business post-divorce, our experienced Texas Divorce lawyers can help you develop the right arrangement with your spouse. This can be accomplished through a buy-out, sale, annuitized settlement, or another distributive arrangement.

Stock Options

If you receive stock options as part of your employment compensation, you can understand the complexities of distributing these assets in a divorce matter. Our attorneys will analyze your stock options to identify the grant date and vesting schedule to determine which assets are subject to equitable distribution.

Your settlement agreement may include a constructive trust to address the tax effects of your stock option distribution. It can also safeguard all post-judgment options while still protecting your pre-distribution interests and rights.

Retirement Assets

If you have acquired retirement assets such as a 401k, 403B, IRA, etc., before or during your marriage, then these accounts may be subject to equitable distribution in your divorce. A common misconception when going through a divorce is that if the account is maintained in your exclusive name, your spouse has no right to claim a share.

In Texas, this is not true in most circumstances. Generally, the value of your retirement account accumulated from the marriage date to the date the divorce complaint is filed will be subject to equitable division. This also generally holds for pensions, deferred compensation plans, SEPs, and SERPs.

While these assets may not be physically split at the time of the judgment of divorce, we work with highly qualified experts to prepare domestic relations orders. These domestic relations orders will help ensure that you receive the proper share and correct benefit amount due to you at an established future date.

Our Role as Texas Divorce Lawyers

Part of our job as your divorce lawyers is to help guide you through the distribution laws. In high net worth divorce situations, we explain any advantages in dividing the retirement asset or offsetting the assets with other assets of the marriage.

We will make sure to discuss and explain in detail all tax ramifications, buy-out alternatives, and the entire QDRO process. As a basic rule, if the asset is earned during the marriage, it becomes a marital asset subject to division, whether the retirement benefit is a pension, IRA, Keogh, 401K, 403B, or even part of an employee stock option plan (ESOP). The division of retirement assets and employee benefit plans is often complicated when pre-marital interests are commingled with marital contributions.

If you face a complex or high net worth divorce, you will need a lawyer whose entire practice is exclusively focused on family and matrimonial law. Due to the complexities involved in these matters, you would be best served by retaining an attorney whose entire practice is exclusively focused on family and matrimonial law.

Your divorce lawyer must know the intricate Texas laws that apply to high net worth divorce cases. If your matter is in the public eye or otherwise high profile, our attorneys will work with you to maintain your privacy and keep your matters contained. This is generally accomplished through mediation or extensive behind-the-scenes negotiations.

Successfully resolving a complex divorce matter requires skill, business acumen, investment knowledge, and experience – which are cornerstones of the Law Office of Bryan Fagan, PLLC. Whether your divorce matter involves complex issues regarding your children and your financial matters, you should take the time to meet with one of our highly experienced divorce lawyers. Secure your future. Call us today: (281) 810-9760.

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