Executive & High Assets Divorce in Orange County
In Orange County, the firm of Pinkham & Associates is often called on to represent parties in high asset divorce matters. Not always, but many high asset divorce present unusual or challenging issues. You have a right to be concerned that your high asset divorce may take more time and be more complex than the average divorce proceedings.
It is also reasonable to be concerned that you could lose vast portions of the wealth you have worked so hard to build. Whether your assets are in the form of businesses, real estate holdings, an extensive investment portfolio, high end retirement vehicles, or a combination thereof, at Pinkham & Associates we have the experience necessary to help you protect your hard earned wealth while still streamlining the divorce process.
Spouses involved in high asset divorces often want to be more involved in the process, due to the nature of what they have at stake. Our Orange County executive and high asset divorce lawyers make certain that our clients are well informed and always involved in all decision-making throughout the process, whenever they so choose. The highly skilled divorce attorneys of Pinkham & Associates pride themselves on working hand in hand with clients that choose to be more involved in their high asset divorce cases, while putting a protective shield around those who only want to get involved when they absolutely must.
What is a High Asset Divorce?
A high asset divorce, or executive divorce, is a bit of an abstract term. But suffice to say, it certainly involves any divorce proceedings involving a combination of high net worth, extensive assets like real property, investments, or where a relatively large inheritance is at stake, or where at least one party is a very high earner.
How Are Assets Divided in Divorce?
California is a community property state when it comes to splitting assets in divorce proceedings, meaning, save an agreement otherwise, marital property must be divided 50/50 upon divorce. Under state law, any assets that are developed, earned, acquired or accrued during the course of the marriage, from the date of marriage until the date of separation, are “presumed” to be community property and therefore, “presumed” to be owned equally by both spouses and are subject to equal distribution in a divorce. Clearly, the parties to a divorce can always agree to divide their property unevenly or unequally, but any unequal division of assets must be done by way of a written, stipulated judgment.
While a 50/50 division of assets may seem fair on paper, this understanding of asset characterization and division can create many problems for high net worth spouses.
Executive divorces in Orange County often involve a substantial acquisition of property during the course of the marriage, including real estate or vehicles in multiple states or across international borders. Executive divorces also often include property that is of “mixed” characterization (separate and community property), such as property that was acquired before the marriage, but improved or “grown” during the course of the marriage, or an asset that was acquired during the marriage, but is grown substantially after the date of separation of the parties. Still other cases involve the possibility of one spouse attempting to lay a claim to investments or assets that should not be considered theirs, or even community property, just by virtue of California property characterization or division laws.
What Assets Can You Lose in a Divorce?
Dividing assets in high asset divorce proceedings is often one of the most contentious areas of the split. Divorce assets, while they may be considered legally owned by both spouses, are often unfairly divided without the help of an Orange County high asset divorce attorney. Examples of assets subject to division in an Orange County executive divorce include anything with monetary value, such as:
- Homes and real estate
- Furniture and antiques
- Collections, including rare or valuable items such as coins, stamps, guns, artwork, jewelry, and more
- Bank accounts
- Investment accounts
- Pension plans
- 401(k) accounts
- Stocks and bonds, and stock options
- High value inheritances of property of any type or kind
What Assets Cannot be Split in a Divorce?
Assets that were acquired before marriage or purchased with “separate property” income, even some types of income earned or acquired during the course of a marriage, may not be subject to a community property division in an Orange County high asset divorce. Other assets, including certain kinds of trusts, inherited income, gifts or income derived from other separate property assets, some business income, and assets acquired after the date of separation, are generally not subject to division as community property.
For this reason, determining the date of separation is always a crucial detail in contested divorces involving high net-worth spouses. Some assets can be protected if a spouse can prove that they were purchased or invested in with funds earned or acquired after separation had already begun, as assets acquired outside of the marriage are presumed to be separate property under California law. In California, both parties do not have to agree to divorce, and divorce papers do not even have to be served to determine the date of separation.
State law considers a several factors when determining what is the date of separation, such as:
- The day that either spouse very specifically informs the other party that their marriage is over, that they do not intend to continue as a married couple. This is often accomplished by way of an email or text.
- It is also very helpful for your date of separation argument to follow up those “words” with actions, such as moving out, moving out of the master bedroom, informing friends and family members of the separation, obtaining new bank accounts, applying for new separate credit cards, dividing common bills or expenses in writing, and/or obvious and open commitment to another partner.
- Consistency after such notice of separation is given and not getting back together or returning to “living as a married couple” is essential. If the parties “get back together as husband and wife”, even for one day, you are “married” again, and a new date of separation must be established.
Common High Asset Divorce Issues in Orange County
Orange County sees a record number of divorces in California, which already has one of the highest divorce rates in the nation. An average of 33 people begin divorce proceedings every day in Orange County, and as the median income is higher here than in most areas, a large number of them qualify as executive and high asset divorces. Our Orange County high asset divorce attorneys regularly handle the following issues:
- Maintaining privacy: In a high net-worth divorce, maintaining privacy is especially important to protect yourself and your interests from business competitors, media disclosure, and more. Working with a professional and discrete law firm such as Pinkham & Associates is one of the best ways to ensure that all the details of your Orange County executive divorce, including your financial situation, any alimony agreements, and circumstances surrounding the divorce remain behind closed doors.
- Child support and child custody disputes: Child custody disputes are among the most difficult issues to resolve in a divorce, and high asset divorce cases are no exception. When both parents cannot come to an agreement concerning the welfare of their child, or when there are other factors at play such as visitation rights, substance abuse, or domestic violence, additional complications are naturally added to the process. Even in a high asset divorce where financial constraints may be less of a limiting factor, protecting the welfare and interests of your child can still be one of the most challenging areas to navigate. Our Orange County executive and high asset divorce lawyers can help simplify this process as much as possible while still ensuring the best interest of your child and your child’s needs are met.
- Contested spousal support: Alimony disputes are very real in high asset divorces in Orange County and elsewhere. An executive divorce lawyer can help uncover hidden assets and any attempts to shelter what is legally considered community income. Additionally, some high net-worth or high-income earners are at risk of paying too much in alimony, which can drain down your personal or business income in support of a former spouse. There are special factors and rules when it comes to exceptionally high earners.
- Division of interest in a family practice or business: Many executive divorces involve interests in a shared business or family practice. Some spouses may be business partners, or have invested income into the other partner’s company or start up. Unraveling a web of shared payments, interest, and investments, often some before marriage, some during the marriage and even some after the date of separation can cause serious complications when division of such a business and are issues often seen in executive divorces. The executive divorce attorneys at Pinkham & Associates have experience with all of these complicated and often subtle issues.
Who is Responsible for Child Support and Alimony Payments?
In Orange County, alimony payments are not decided by gender. The higher earning spouse may be ordered to pay alimony as part of a divorce, regardless of gender. For this reason, alimony is often an important question in a high asset divorce, especially when one party has a significantly higher net worth or income, or when one spouse’s lavish lifestyle has been solely supported by the other during the course of the marriage.
Importantly, California’s child support guidelines were not designed with high asset divorces in mind. They were generally set with lower-income parents in mind and are based around how to provide a baseline level of care for a child or children during and after the dissolution of a marriage. There may be a host of other variables at play in a high asset divorce when children are involved, and simply relying on state guidelines can leave high net worth parents without a clear understanding of how much parents should pay. In order to determine a more accurate calculation, an Orange County high asset divorce attorney will consider California statutes and questions like:
- Which parent will become the custodial parent?
- How is custody being decided?
- What is the amount of time that will be allocated to each parent?
- Are there any out of state or international visits involved in custody?
- What are the relative incomes of both parents?
- What kind of lifestyle have the parents established for their child during the course of the marriage?
- Is there a prenuptial or postnuptial agreement involved?
Married without a Prenup or Postnup
If you married without a prenuptial or postnuptial agreement, property may be divided in a way that contradicts your wishes or needs, and you may have a more difficult time proving that some of your income is separate. However, it is still possible, with forensic financial analysis, to paint a true picture of what kinds of assets or investments you may be able to establish as separate property, or you may have even kept such assets isolated during the course of your marriage. If so, you may very well be able to protected certain accounts and gifts from being divided in an Orange County high asset divorce.
Concealed assets are often the biggest game changer in a high asset divorce. Offshore bank accounts, investments made overseas or in other states, property owned or purchases made under different names can all greatly change financial agreements during a divorce.
It is important to remember that California’s understanding of property means that both assets and debt acquired during the marriage are considered shared equally by both spouses. When one party discovers that the other has significant concealed assets, or alternatively, the possibility of concealed debt, it can change the financial picture entirely.
How to Protect Assets from Divorce
State law offers several protections for assets in divorce proceedings, but not all of them are available once a divorce is already underway. In this case, speaking with an executive divorce attorney serving Orange County may be the best option you have for finding creative solutions to protect what is rightfully yours, before a divorce is filed.
Protecting Your Retirement Accounts
You may have expected to share the money you have saved for retirement with your partner, but now that divorce is underway, you will understandably want to keep it for yourself. State law, however, considers contributions made and earnings on those contributions to retirement accounts such as IRAs and 401(k)s to be community property if those earnings and accumulations were made during the course of the marriage. Even accounts you yourself cannot yet access, such as retirement savings or stock options, can be considered for division during an Orange County high asset divorce. Without the help of a highly skilled executive divorce lawyer, these types of assets are often divided improperly.
Protecting Your Valuable Collections
Valuable gun or firearm collections, fine art collections, fine jewelry, luxury, exotic, or collector cars, or other unique items may be subject to division in a high asset divorce in Orange County. However, common protections for valuable collections involve gift or inheritance claims made solely to one spouse. Providing documentation of the gift, especially in writing, can help protect your claim to your valuable collections.
Additionally, unless a court order has been issued giving your former spouse sole ownership – or a restraining order, you have the right to acquire your own property from your home in Orange County, even if it was your choice to move out from the shared residence. State law even protects a spouse who needs to hire a locksmith to reclaim their own property, should their ex change the locks on a shared residence. Breaking into your own home, should your spouse change the locks, while technically legal, will very likely cause additional problems in your divorce process. We do not recommend this type of self-help.
High Asset Divorce Mistakes to Avoid
Navigating a high asset divorce in Orange County can be a tense, high-stakes process, as both parties strive to keep their lifestyles intact in the wake of separation. At times, one spouse may claim ownership of property, accounts, and assets that the other may want to keep for themselves. Some of the biggest mistakes our firm sees during high asset divorces involve the breakdown of communication and even dishonesty during divorce proceedings or immediately before the separation causing misunderstandings, confusion followed by district regarding property and debts of the community.
This confusion and potential distrust of one’s partner is exactly why we have and use the discovery process. Simply speaking, discovery in a divorce case is how we look for assets and debts, the value of such assets and debts, and try to determine if there is a common understanding of ownership, control and ultimate distribution of such assets and debts upon the conclusion of the divorce proceeding.
Common examples include:
Hiding Assets before Divorce
Knowing the status of any and all shared and separate property before a divorce can help you greatly when it comes time to make the split, and avoid the need to “trust” your partner in the process. But unfortunately, that isn’t always practical or possible. Our team of Orange County executive and high asset divorce attorneys and use of forensic accountants can help determine whether assets have been hidden during times of marital distress before a divorce was decided upon.
Signs of hidden assets before a divorce might include:
- Obvious, or less obvious transfers or missing funds
- The discovery of unknown bank or credit accounts
- New or sudden purchases of gold of silver coins or bullion, or high end jewelry
- Delayed payments, benefits, bonuses, or reimbursements until after your separation
- Address changes on accounts, or the opening a PO Box
- Missing financial records or claims of sudden destruction of deeds or natural disasters
- Increased gifts or loans to friends, other family members, or business partners
- Increased spending, or new loans often used to siphon money from joint accounts
- Unexpected international travel or discovery of out of state addresses
When one partner has more control over finances than another and a divorce is looming, there are very often transfers or purchases such as those listed above as underhanded attempts to deprive you of a fair settlement. Our team of executive divorce experts can help.
Hiding Assets during Divorce
In Orange County, a spouse may be found liable for violations of their fiduciary duties to the other spouse for concealing or transferring assets or failing to disclose accounts or investments on their financial disclosure documents during a high asset divorce. This type of violation of fiduciary duties can be very serious and can result in several penalties, such as monitory sanctions, an order for one party to pay attorneys fees for the other and even an order that the innocent party receives 100% of the asset in question under the California Family Code.
Hiding assets during a high asset divorce in Orange County is a very serious breach of duty, and it is illegal. An experienced executive divorce attorney can ensure that a spouse who attempts to conceal assets or lie about their financial status on official documents is held fully accountable with damages, penalties, and the full might of California law.
Benefits of Working with a High Asset Divorce Attorney
Hiring an experienced Orange County executive divorce attorney can help you avoid being taken advantage of during this difficult and often emotional time. A divorce is one of the most stressful experiences a person can undergo, and they are unfortunately common events in Orange County, CA. Our attorneys are not only skilled legal advocates – many of us have been there ourselves. The team at Pinkham & Associates can help you with the unique needs of an executive divorce such as:
Determining the Value of Your Assets
An appraisal of all of your assets, including real estate, retirement accounts, joint businesses, property, and investments is often a massive undertaking in a high asset divorce, but it is crucial. Doing so is the only way to ensure that assets and debts are not concealed from official documents, as well as to build a successful case for separate property by showing immaculate record keeping and rock solid legal protections.
Access to Financial Experts and Forensic Accountants
Our office offers access to the most reputable financial experts you may need in order to create an accurate financial picture and ensure that your assets are protected under California Family Law. By serving Orange County since 1999, we have compiled a complete list of most trustworthy experts, including forensic accountants and appraisers of both real estate, all the way to jewelry and exotic or classic vehicles, as well as in-house services that we can offer to our executive divorce clients in and around Orange County.
Compliance with California Divorce Law
The experts at Pinkham & Associates are fully licensed and certified to handle your Orange County executive divorce case. Our firm has been a pillar of the Orange County family law community for over 25 years and has earned its stellar reputation for legal expertise and client satisfaction.
Achieving a Favorable Divorce Outcome
It does not need to be, but divorce is often unpleasant, even when it’s necessary. Our Orange County executive and high asset divorce lawyers will fight for you to receive the best outcome possible and can help you protect what you are unwilling to compromise on. Whether your main concern is your children, your business, your personal wealth, one or more particular assets, your retirement savings, or a combination of many factors, our high asset divorce attorneys in Orange County are experienced negotiators and skilled legal advocates ready to fight for your rights in court if necessary, and always communicate in advance any time we feel we may be able to negotiate around or avoid a time consuming and expensive protracted legal battle.
Orange County Executive and High-Asset Divorce Lawyer: FAQs
Our firm commonly receives the following questions about Orange County divorce law from high net-worth individuals seeking our services:
Can a trust protect assets from divorce?
Using a trust to protect assets in executive divorce proceedings only works under very certain circumstances in Orange County. The best chance of using a trust to shelter assets is when it was established in advance of the marriage, creating the assumption of separate property from the start. A judge may order the distribution of assets held in a trust that was created in anticipation of divorce in an attempt to circumvent California state community property laws. Additionally, some Domestic or Foreign Asset Protection Trusts may still be subject to division under California and Orange County divorce law. Contact the Orange County high asset divorce lawyers of Pinkham & Associates for a personalized look into the details of your business or protective trust.
Do both spouses have to be high-earners for their divorce to be considered high asset?
No. In many Orange County divorces, only one spouse is considered to be high net-worth. Alternatively, both spouses may be high earners, but one still earns considerably more than the other. Either way, the fact that high income or relatively high value assets and debts are subject to the laws of California and Orange County and subject to distribution under such laws.
What is the penalty for hiding assets in divorce?
Family Code in California allows for the imposition of financial damages and penalties, as well as orders to pay attorneys fees for the other party. But most of all, if you are caught intentionally hiding a community property asset from your spouse, she will receive her half of the community property asset as it already belongs to them, then as a punishment, they will receive your half of the asset. If you are caught, you may end up giving your spouse 100% of that asset.
Call an Orange County Executive and High-Asset Divorce Attorney
Our Orange County executive and high asset divorce lawyers are experienced, skilled, judicious, and compassionate legal professionals ready to assist you with the unique needs of your high asset divorce. We understand the extensive nature of the discovery and forensic analysis process surrounding executive divorces and can help expedite the proceedings while also creating a thorough defense of your property and rights. Contact Pinkham & Associates today for a consultation, and let us show you how we’ve earned our stellar reputation for success.