What are Commingled Assets in a High Net Worth Divorce?
If you are going through a divorce in the Charlotte area, you may be faced with all kinds of different legal terms. “Commingled assets” is definitely an example of “legalese,” and you may be asking yourself what this term actually means. While commingled assets might not be a massive issue for couples with low incomes, it can become a serious obstacle during a high net worth divorce in North Carolina. In some situations, you might be faced with forfeiting millions of dollars in separate assets that have been inadvertently mixed together with marital property.
If you want to avoid losing considerable sums as these as assets are divided through equitable distribution, it is in your best interest to reach out to a qualified, experienced divorce attorney in Mecklenburg County or the surrounding areas as soon as possible. These legal professionals can help you develop an action plan to reverse this situation. Even though it can be difficult to trace and “unravel” commingled assets, it is by no means an impossible task. With the right legal strategy, you can avoid needlessly losing considerable assets that have been commingled.Understanding Commingled Assets
Although commingled assets might seem complicated at first glance, this is a relatively simple concept. Commingled assets are separate and marital assets that have been mixed together over the course of the marriage. This is more common than you might think, especially when both spouses are contributing to the financial well-being of the family. Commingled assets become an issue because of the way North Carolina handles equitable distribution during a divorce.
While separate assets always remain in the possession of the spouse who owns them, marital property is eligible for equitable distribution. If all your assets are neatly divided, there is not much to worry about. For example, you might have owned several real estate properties prior to your marriage. In a divorce, you would maintain possession of these properties.
However, things can get complicated if things were not kept “neat and tidy” during the divorce. A classic example of this is when one spouse uses their inheritance cheque to put a down payment on a property during the marriage. Normally, inheritance funds are always classified as separate property. When you use these funds to purchase another asset during the marriage, it can technically become marital property. Marital property is all property that was accumulated during the marriage, and it is subject to equitable distribution. In other words, marital property and separate property have been commingled in this example.How to Trace Commingled Assets
In a high net worth divorce, it is worth tracing your commingled assets so that you do not lose separate property that is rightfully yours. This is a complicated process, but it can be done without too much of a headache. First, you will need to make sure the court is aware that your assets have been commingled. If you do not make this claim, the court will simply assume that your commingled assets are marital property. Next, you will need to trace your commingled assets.
This is a time-consuming process, and you will likely need help from financial experts, such as forensic accountants. These experts will go through your mortgage statements, financial records, bank account activity records, purchase records, and many other documents. After accurately figuring out which assets belong to who, you can walk away with your separate property.Prevention is the Best Solution
Preventing this from ever happening in the first place is the best approach. This can be done by simply keeping your separate property and your marital property apart during the marriage. Additionally, you can also avoid this situation with a strong prenuptial agreement. Of course, not every couple plans for these types of scenarios. Divorces can often come out of the blue, and you may have thought that separation was an unthinkable outcome when you first got married. Do not lose heart if you commingled your assets during your marriage. With assistance from legal and financial experts, you can try to rectify this situation.Enlist the Help of a Qualified Divorce Attorney in Iredell County
If you want to approach your high net worth divorce with confidence and efficiency, you should enlist the help of a qualified divorce attorney in the Charlotte region as soon as possible. When high-value assets have been commingled, you need the best possible legal assistance to help correct the situation. Reach out to Arnold & Smith, PLLC today, and we can help you keep hold of your separate property, even if it has been commingled. There is no need to walk away from assets that are rightfully yours.