Considering a High Asset Divorce in Massachusetts?
The Challenges of High Asset Divorce
Even though many divorces can be challenging to resolve, they are often particularly contentious when the parties are attempting to get their “fair share” of substantial assets. A high asset divorce in Massachusetts can quickly grow quite complex as various pieces of property need to not only be assessed in value but divided equitably between the splitting spouses.
And, while such disputes can give birth to a wide variety of financial issues – such as questions of alimony or division high-value assets such as homes, retirement accounts and businesses – they need to be settled before the parties can move on with their lives.
Property Division Laws
equitably during divorce, which is not necessarily equally – meaning Massachusetts courts will apportion marital assets based upon what will yield a fair and reasonable result, as opposed to an automatic 50/50 split.
The Massachusetts property division statute also dictates that a court may “assign to either [party] all or any part of the estate of the other.” Essentially, this means that courts are free to divide any property owned by the couple, regardless of whether it was acquired before the marriage (separate property) or during the marriage (marital property). This is particularly important given the fact that most states limit post-divorce property division to marital assets alone. In Massachusetts, courts will often assign separate property to the spouse that owned it originally, though they are not required to do so.
While Massachusetts divorce courts generally have great discretion when dividing assets, there are statutorily created factors that must be considered when making these determinations, including:
- The length of the marriage
- The conduct of each party during the marriage
- The age, occupation, income, health, estate, vocational skills and employability of each party
- The needs and liabilities of each party
- The opportunity of each party for future acquisition of capital assets and income
What Happens to the House?
Often, one of the biggest assets to be divided during divorce is the marital home, especially if the spouses have been married for years and accumulated significant equity in the house.
There are many options available to parties, not necessarily limited to selling the home and splitting the profits. Other considerations – such as declining home prices or the existence of school-aged children – may actually give rise to more advantageous, alternatives. For instance, rather than simply selling a home and splitting the proceeds, Massachusetts courts have ordered:
- One spouse to convey his or her interest in the home to the other spouse, on the condition that the second spouse make a payment to the conveying spouse representing his or her equitable share
- One spouse to convey his or her interests in the home to the other spouse, with the conveying spouse being compensated with an award or other assets or property
- That the home be awarded to the spouse with custody of the minor children on the condition that the house be sold and the profits divided once the children all graduate high school
- That the right to occupy the home be awarded to one spouse until a predetermined future date, or until the happening of a specific event, at which time the home will be sold and the proceeds divided
Retirement Accounts & Businesses are Subject to Division
A high asset divorce may include substantial assets the spouses have spent years building, including retirement accounts and/or businesses. Under Massachusetts law, retirement funds – such as pensions – as well as ownership interests in businesses are assets that can be divided during divorce. But, before they can be divided equitably, they must first be valued.
While the valuation process can be simple when dealing with retirement funds – with several exceptions – or even stock in a publicly traded company, it is typically more complicated when valuing on a closely-held company owned by one of the spouses. Indeed, given the complex nature of valuing a closely held company, experts are often employed to determine market value.
Division of accumulated assets is not the only concern for couples going through a high asset divorce in Massachusetts. For many, the main financial issue to be resolved is the matter of alimony, which is sometimes referred to as spousal maintenance.
The law in Massachusetts regarding alimony changed significantly in 2012. There are now four different types of alimony payments that can be ordered by Massachusetts courts: general, rehabilitative, reimbursement and transitional. Given that each type serves a distinct purpose, courts will typically examine several factors when determining which type to order – if any – in addition to the amount and duration. These factors include, but are not limited to:
- Length of the marriage
- Age of the parties
- Health of the parties
- Employment, or employability, of the parties
Essential Legal Guidance
A high asset divorce can be particularly problematic for splitting spouses. Not only can they involve complex asset division, but in some instances, one of the parties may attempt to hide assets. This is why it is imperative to consult with an experienced divorce lawyer if you are contemplating divorce and believe it may become contentious. A skilled family law attorney will help find all marital assets and assist in ensuring that your rights are protected during the process.
Please contact our firm at 617-523-4300 to schedule an initial consultation. One of our attorneys is a bilingual native speaker in both Spanish and English, and another is fluent in French.