Do Not Make These Mistakes During Your High Net Worth Divorce
Divorces are always complicated, but cases involving high net worths are even more complex. Like in any divorce case, the couple involved in a high net worth divorce may make some mistakes that were preventable. Unlike other divorces though, the mistakes made in a divorce that involves a large amount of assets can have consequences that are far-reaching and in some instances, could even have criminal consequences. If you are about to get a divorce and you or your spouse have a high net worth, avoid making these three biggest mistakes.
Waiting Until the Divorce is Final Before Worrying About the Terms
All divorces are stressful, but when a case becomes particularly contentious, you may want to rush the process simply so that it is over and you can move on with your life. You may even say that you do not care what the consequences are, you just want the case to be resolved. Many people even tell their divorce lawyer to just give their spouse whatever they want. This is a huge mistake in any case, but it has more consequences during a high net worth divorce. If you do not fight for your rights, you may not get as much access to your children, you may forfeit alimony or have to pay an unfair amount, and may not receive all of the assets to which you are entitled.
Failing to Consider Tax Implications
Under Pennsylvania’s property division rules, each spouse is entitled to equitable distribution of the assets. Many people are happy to move forward with this state law, but do not fully consider the tax implications of doing so. For example, a spouse may be happy that they acquired an asset that has a substantial built-in gain. When they do not know of this gain beforehand, they may believe that they received a good settlement or judgment. If at any time they sell or liquidate that asset though, the IRS will recognize that built-in gain and the spouse that liquidated it will receive a hefty bill at tax time.
People sometimes hide assets during a divorce out of spite. Or, in many instances, a person may realize that a certain asset is theirs, and they may already know that their spouse will not want it. Even when this is true, it is still highly inadvisable to hide any assets. The court will likely learn of the hidden asset and you will not only lose credibility in the judge’s eyes but also may be penalized. Once you have lost that credibility with the court, it is extremely difficult to get it back. Worse than this, depending on the circumstances of the case, you could face criminal charges such as wire fraud or tax evasion if you used a computer to transfer property, or you hid the assets in such a way that you appeared to be hiding them from the IRS.
Our Pennsylvania and New Jersey Family Lawyer can Help with Your High Net Worth Divorce
High net worth divorces are some of the most challenging cases. If you are going through a divorce and you or your spouse have a significant amount of assets, it is essential that you speak with a Philadelphia family lawyer. At the Law Offices of Lauren H. Kane, we know how to proceed with these cases and how to secure the fair settlement you deserve. Call us today at (215) 918-9453 or contact us online to schedule a consultation with our experienced attorney.