High-level executives typically have complex compensation packages. These can greatly complicate asset division during a divorce. The skilled property division attorneys at Dolan Divorce Lawyers can help you seek an equitable division of executive compensation following a New Haven divorce. Our firm frequently handles property division issues for high-net-worth individuals who are getting divorced. We have the knowledge and experience to anticipate the issues that can arise in these circumstances.
A salary may be the least valuable component of a high-level executive’s total compensation package. It may include numerous incentives and significant stakes in their company’s success, such as generous retirement benefits, deferred compensation, and opportunities for stock purchases.
Many of these components take advantage of preferential tax treatment, and splitting them with a non-employee in a divorce may erase the tax advantage. Our lawyers routinely have tax specialists and other professionals in New Haven assess complex compensation packages and devise a method of sharing their value fairly between spouses while retaining tax efficiency after the couple’s divorce.
Connecticut uses the equitable distribution method of dividing property in a divorce. Anything either spouse owns is potentially subject to division, even assets they acquired before their marriage. Both spouses have an interest in all income an executive spouse earned during the marriage, including stock options they cannot yet exercise, interests that have not vested, and other forms of deferred compensation.
The individual goals of the spouses and the couple’s holdings outside the compensation package affect the division. The law entitles each spouse to an equitable share of the property. Factors, including the length of the marriage, the reason for the divorce, and the financial status of each spouse after the divorce, determine fairness.
It may be possible to avoid some complications and potential tax implications of splitting the components of an executive compensation package by allocating assets of similar value to the non-executive spouse. Connecticut General Statutes § 46b-82 allows alimony when the circumstances justify it. Our New Haven legal team can negotiate an alimony arrangement that allows the executive spouse to retain their compensation package and its future benefits following their divorce, while ensuring the non-executive spouse’s future financial comfort.
Both spouses must make complete financial disclosures in any litigated divorce. What a standard request for production asks for includes:
These disclosures are insufficient in a divorce involving a high-level executive compensation package. The typical mandatory production may not reveal stock options, performance incentives, bonuses, and deferred compensation. More extensive formal discovery is often necessary to get an accurate sense of the executive spouse’s assets and expectations.
Requests for more documents and answers to interrogatories (i.e., written questions) may suffice. Sometimes it may be necessary to depose a spouse and third parties (such as their employer) to ascertain the details of a compensation arrangement. Our New Haven attorneys have extensive experience handling discovery related to the post-divorce valuation of executive compensation, whether representing the executive or the non-executive spouse.
Executive compensation following a New Haven divorce is a key concern when high-net-worth couples divide their property. If you or your spouse receives this type of compensation, our lawyers have the financial acumen and resources to pursue an equitable resolution to your divorce case. Contact our team at Dolan Divorce Lawyers today to learn more.
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