What Tax Considerations Should I Be Aware of During a High Net Worth Divorce?

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Divorce is a complex matter that requires careful consideration, particularly for high-net-worth individuals. This is due to the potential involvement of intricate financial issues, such as asset division, spousal maintenance, business ownership, investments, and tax implications. The intricate nature of these financial matters often necessitates the involvement of legal professionals to ensure a fair and equitable resolution. If you are facing a high net-worth divorce, contacting a determined Suffolk County High-Income Divorce Attorney who can safeguard your rights is in your best interest. Please continue reading to learn the tax implications of the decisions made during the divorce process.

What is a High Net Worth Divorce?

Historically, a high-net-worth divorce is one in which the divorcing couple has significant wealth to divide. Such splits typically involve at least $1 million worth of assets. However, the amount has substantially increased in today’s economic environment as more and more cases involve multiple millions of dollars. Handling these types of cases can pose unique challenges. While a high-net-worth divorce may involve the same issues as other divorces, resolving these issues can become more difficult due to complex assets. Those who have worked hard to acquire this level of wealth have more at stake. That said, it’s in your best interest to connect with an experienced Suffolk County high-income divorce attorney who can help protect your hard-earned assets.

What Are the Tax Implications?

One of the main considerations in any divorce is how marital assets will be divided between spouses. Property distribution becomes even more critical in a high-net-worth divorce due to the significant value and complexity involved in assets such as businesses, real estate properties, investments, stock options, and retirement accounts. Property division often has tax implications because large transfers trigger significant tax liabilities. How these complex assets are divided can have substantial tax consequences for both parties.

For instance, when dividing appreciated assets like stocks or real estate properties between spouses, any capital gain taxes associated with those assets will need to be paid if these assets are sold or transferred. Dividing employer-sponsored retirement accounts may require you to withdraw before your treatment age, which could incur early withdrawal penalties and income taxes. However, using a Qualified Domestic Relations Order (QDRO) to divide assets will allow funds to be withdrawn and transferred without incurring taxes.

If you are going through a high net-worth divorce, you must partner with an experienced Suffolk County high-income divorce attorney who can help you understand the potential tax ramifications of divorce-related decisions. At The Law Offices of Susan A. Kassel, P.C., we are prepared to handle complex divorce cases involving significant assets. Contact our firm today to learn more about how we can assist you.

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What Our Clients Are Saying

I hired Susan to represent me in a divorce matter where I was fighting for custody and to limit my wife's equitable share of our assets. I won custody of our son, kept the marital residence, kept my professional practice, kept my building and paid less than half to my wife. This was after a long-term marriage. She could persuade the court that equitable is not equal and sometimes the man does deserve to win!

‐ Dave

I first must say that I had been represented by two prior attorneys both of whom had simply taken my money and left me nothing to show for it in my custody case. They kept telling me what they were doing for me but I found out they were lying. Susan on the other hand had gotten me temporary custody and support for my children and myself within two months of hiring her. I cannot say enough about her.

‐ Craig

After talking to a few other attorneys, I hired Susan to represent me in my divorce and custody dispute. I was reluctant to go with her because she was the cheapest out of all the other attorneys I met with, but I'm so glad I did. I am 100% positive no one else would have done such a great job with my case as Susan and her staff. Her work is quality, her staff is reliable and her character is honorable. There...

‐ Linda

I had a very difficult case where I had already burned through two attorneys who were unable to get me custody of my children and complete my divorce. Susan was able to rapidly work out an agreement and not let it just malinger on like my previous experiences. She was also considerate of my financial situation unlike all of the other lawyers I had spoken to. I highly recommend her if you want complete and caring service with an in-depth knowledge of...

‐ Joanne

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The Law Offices of Susan A. Kassel, P.C. proudly serves clients throughout Suffolk County, New York in their divorce, family law, and estate planning matters. If you require the services of an experienced Suffolk County attorney, schedule a consultation with The Law Offices of Susan A. Kassel, P.C. today.

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