Common Mistakes Regarding Property Division in North Carolina
Property division can be incredibly complex in a North Carolina divorce, especially if there is a lot to divide. Spouses with high net worths need to go through a number of expensive assets and decide how to divide everything in the fairest, most equitable manner. Obviously, this can lead to serious arguments. When you are dealing with multiple assets that have seven-figure values, even a few percentage points can lead to significant losses. Spouses want to act in their best interests and keep hold of as many assets as possible following a divorce.
During these stressful and high-pressure scenarios, it is easy to make mistakes. Couples might focus too heavily on one asset while forgetting about another. There may be tax implications that you do not factor in, especially if your main priority is keeping hold of an asset no matter what. All of these mistakes can be quite costly, and spouses should do everything they can to avoid them.
Avoiding these mistakes is obviously much easier when you are working with a qualified, experienced divorce attorney in North Carolina. These legal professionals can keep a watchful eye out for potential issues, and they can steer you in the right direction. You can work with your attorney to prioritize certain assets while also avoiding common mistakes. An experienced attorney is well aware of the complexities of property division, having dealt with these cases many times before.Commingling Assets
This mistake actually occurs before the divorce, but it is worth mentioning anyway. When assets are commingled, it means that marital and separate property have been mixed together. Separate property includes everything you owned prior to signing the marriage contract, plus things like gifts and inheritance. Marital property includes all of the assets you accumulated during the marriage. A common example of a commingled asset is as follows:
You receive an inheritance from your late relative, and you use this money to pay off part of the mortgage on a home you and your spouse purchased during your marriage. After separating, you argue that you deserve to get that inheritance back, since it is separate property. However, it has been “mixed” with the value of the home. Now you need to go back with a fine-tooth comb to separate your inheritance from the property again, and you also might need to consider things like the increase (or decrease) of value of the property.Assuming Your Prenuptial Agreement is Valid
Do not simply assume that your prenuptial agreement is valid. Many high net worth individuals like to believe that they are completely shielded from negative consequences due to a “rock-solid prenup,” but there are many ways in which a shrewd spouse can overcome this legal measure. A spouse might argue that they signed the prenuptial agreement involuntarily, that it was based on misrepresentations of the facts, or that it is based on fraud.Not Considering the Tax Implications
The tax implications of a divorce can be quite considerable, especially when you are dealing with high-value assets. In many cases, couples are so focused on keeping the family home or some other desirable asset that they fail to factor in the tax consequences after the divorce has been finalized. There are many actions that trigger taxable transactions, and you need to be aware of these before you make any important decisions. If you disregard this, you could discover that your tax bill far outweighs any potential gain you might have enjoyed from holding onto certain assets.Concealing Assets
Obviously, it is never a good idea to conceal assets during a divorce. Unfortunately, many spouses try to get away with it anyway. While it is true that there are a few ways in which spouses can successfully conceal assets (such as bitcoin), they run a tremendous risk as soon as they engage in this criminal behavior. If you are caught, you can say goodbye to a favorable divorce, as your spouse will get a better end of the deal when it comes to virtually every asset that needs to be divided.Enlist the Help of a Qualified Attorney Today
If you have been searching the North Carolina area for a qualified, experienced divorce attorney, look no further than Arnold Smith, PLLC. We have dealt with many divorces in the past, including those involving high-net-worth, complex property divisions. We know how contentious these divorces can be, and we appreciate the importance of you keeping hold of your assets. That being said, you also need to watch out for common mistakes during this process, and we can certainly help you avoid these potential issues. Of course, we can also help you with virtually every other aspect of your divorce, as well, so reach out and book your consultation today.