Ultimate Guide to Divorce for High Net Worth Individuals: High Asset Divorce Tips
Divorce tips for high net wealth individuals are uncommon. That's because most divorce attorneys lack the knowledge or experience in handling high asset or financially complicated divorce cases.
Planning ahead is critical to avoid costly mistakes during a divorce. A prenuptial agreement can help you avoid common pitfalls when dividing assets and debts.
High-net-worth individuals are more likely to get divorced if they plan ahead. Divorce planning includes working out a parenting plan before going to court. This reduces the likelihood of significant litigation. Planning also helps avoid a messy situations when children are involved.
Absent high conflict cases, this isn't only possible but probable. When divorcing a high conflict person, you should take the decision out of their hands and leave it up to the court. Having a flexible schedule is important because your spouse may be difficult to workaround.
You'll also want to consider how your children will react if you're working late or traveling frequently. A good divorce attorney can help you get a custody arrangement that takes that into account. Moving out is very difficult because of the emotional attachment children form with their parents. There are many dangers when moving out. Parents should take time to consider what they are doing before making any decisions.
Divorce is a process that can get messy. If your spouse is going to make things hard, moving out makes it easier for them to do so by making it easier for them to restrict your access to the children and other resources. You can take a negotiation position that issues have to resolve as a team or not at all. This could lead to sanctions if you're found to be in contempt of court. When you divorce, you are giving up your rights to your children. You should never do this because it could lead to more problems later on down the road. You also give up any chance of getting back together if you ask your ex-spouse for a second divorce.
Child support should be simple. Computer programs should help calculate child support payments. Alimony needs to be decided by a judge. Judges may use computer programs for temporary orders, but they must decide on final orders based on what is fair and reasonable. High net worth individuals should be expected to pay more than average income because of their higher incomes. However, the amount of money you make should never dictate how much you pay your ex-spouse or children. You should always strive to be fair when dealing with these situations.
High net worth people typically have a base income. Their incomes come in various forms. These include regular draws, an actual salary, and capital gains. Some high net worth people make more money than others because of their businesses' profitability. High Net Worth Individuals (HNWIs) are people who have more than $1 million dollars in assets. HNWIs also have more than $5 million dollars in annual income. These individuals usually work in businesses such as law firms, consulting companies, investment banks, and accounting firms. HNWIs often receive bonuses when their business does well. HNWIs may also receive stock options or other types of compensation if they do well in their job. High Net Worth Individuals must pay taxes on their earnings. Their expenses are deductible, but the IRS considers them as a form of compensation. In addition, there are some allowances that are considered taxable income. For example, car allowances, travel allowances, etc., are considered taxable income. However, these allowances are usually nontaxable because they are considered a form of compensation for services rendered. Perquisites are considered nontaxable income by the IRS. This means that if you receive them as part of your salary, they do not get added to your taxable income. However, if you receive them as gifts, then they are taxable income. High-net-worth individuals should be careful when investing in real estate. They need to consider how much money they actually make off the investments. Some people might pocket the money without paying taxes.
A family court judge may consider deductions for phantom income when determining child support payments. However, the judge must be careful about making such an adjustment since it could impact the amount of child support paid by the noncustodial parent. Our family lawyers know the law in this field, and we help our clients understand what the law requires. Phantom income is income that is reported but isn't actually received by the person who receives it. This is common when corporations pay out dividends to shareholders. In this case, the company doesn't give the dividends to the shareholders as cash. Instead, it uses the money to make retained earnings. So the shareholder reports the dividend income on his or her taxes, but the company keeps the money for future use. Other examples include phantom income from rent, interest, and royalties. In most situations, this unreceives phantom income is not part income available for support.
Child support is calculated by using a formula that takes into account both parents' incomes. Temporary spousal support is based on the length of the marriage and how much money each party brings in. Judges and lawyers use formulas to determine these amounts.
Divorcing spouses often spend money on extravagant gifts, expensive dinners, and fancy vacations. This behavior may be an attempt to win back their ex-spouse's affections but it usually ends up being a costly mistake. Hoarders believe that if they buy expensive things, they will get more money later. This isn't true. Spending money now doesn't automatically mean you'll get more money later. In fact, people who spend too much often end up having less money than those who save or invest their money. So, instead of hoarding, you should be saving and investing.
High net worth individuals typically have many assets that make them easy targets for divorce lawyers. These people often have large homes, luxury vehicles, stocks, bonds, retirement funds, and real estate holdings. An experienced divorce attorney in Harris County, Galveston County, Fort Bend County, Montgomery County, Brazoria County, Houston, Sugar Land, Missouri City, Stafford, Texas at Thornton Esquire Law Group, PLLC, will help you with your divorce case just contact us today at www.thorntonesquirelawgroup.com.