High income and/or high net worth divorces often require more experience and expertise than typical cases because of added complexities. If your situation involves some or all of the following, strongly consider an experienced attorney like Glenn Tanner:
- Valuation of Businesses and Professional Practices/Licenses; the winning strategy often depends on choosing and preparing with the right expert. Hiring an appropriate expert early can focus discovery and secure information that might otherwise disappear. Working effectively with the right expert can help neutralize the persuasiveness of the other spouse’s expert.
- Hard to value assets like patents, literary rights and other intellectual properties.
- Complex investments or histories.
- Holdings in multiple states or overseas.
- Extensive separate property requiring careful preparation to determine the amount and character (separate or community) of property.
- Prenuptial or Postnuptial agreements. Do not assume your agreement is enforceable in whole, or in part.
- Significant different tax consequences to different property divisions and maintenance awards.
- Long term marriages with significant income disparities between spouses making significant maintenance awards a possibility.
- Family Farms and stock options.
- Highly combative spouses, perhaps with Type-A personalities or personalities disorders like narcissism, likely to engage in relentless litigation, endless discovery, continuous bad faith negotiations and mediations.
- Complex facts requiring the attorney to handle and present a wide assortment of financial, accounting, and tax issues concerning multiple businesses, entities, investments, real estate, valuable personal property like art, antiques, and other collections, partnership and employment agreements, employee benefit plans, QDROs, ESOPs, large bonuses, inheritances, personal injury awards, defined benefit plans, etc.
- Preparation and illustration of the implications of different settlement proposals and their ramifications short term and long term to both parties in light of differences in investment income, earnings, taxes and other variables.
In high net worth and/or high income cases, your choice of attorney can make the difference between winning or losing. High stake divorces can be demanding on the spouses, children, families and attorneys. You need an attorney with the experience, resources and qualifications to handle the intensity, drama, and complexity of such divorces – an attorney like Glenn Tanner.
Glenn works closely with accountants, appraisers, and certified divorce financial analysts when effective to assess, value, and present your case. Investigators can trace significant assets despite attempts to obscure their existence. Injunctions and orders can be obtained to prevent liquidation of assets against your interest and to maintain your cash flow from businesses or to allow your continued effective operation of a business.
When there is one high wage earner and one traditional “homemaker”, now in different households, the foremost short-term issue often is cash flow to maintain reasonable lifestyles. It is frustrating to be a physician earning $400,000 annually but also unable to meet the monthly bills. Decreases in real estate values and the current economic down turn exasperate the situation. The homemaker depends on child support and maintenance (alimony) to maintain the household. High levels of debt, expenditures on setting up new households and careers, and romancing new relationships, can all contribute to cash flow problems. Large bonuses may be sporadic or end, and the higher wage earner finds it difficult to make significant regular maintenance payments. The amount and length of maintenance are discretionary with the court and are determined after consider the following factors set forth by the Washington State legislature in RCW 26.09.090:
(1) In a proceeding for dissolution of marriage or domestic partnership, legal separation, declaration of invalidity, or in a proceeding for maintenance following dissolution of the marriage or domestic partnership by a court which lacked personal jurisdiction over the absent spouse or absent domestic partner, the court may grant a maintenance order for either spouse or either domestic partner. The maintenance order shall be in such amounts and for such periods of time as the court deems just, without regard to misconduct, after considering all relevant factors including but not limited to:
(a) The financial resources of the party seeking maintenance, including separate or community property apportioned to him or her, and his or her ability to meet his or her needs independently, including the extent to which a provision for support of a child living with the party includes a sum for that party;
(b) The time necessary to acquire sufficient education or training to enable the party seeking maintenance to find employment appropriate to his or her skill, interests, style of life, and other attendant circumstances;
(c) The standard of living established during the marriage or domestic partnership;
(d) The duration of the marriage or domestic partnership;
(e) The age, physical and emotional condition, and financial obligations of the spouse or domestic partner seeking maintenance; and
(f) The ability of the spouse or domestic partner from whom maintenance is sought to meet his or her needs and financial obligations while meeting those of the spouse or domestic partner seeking maintenance.
Private schools, new cars, long vacations and other life-style expenditures that were manageable during the marriage become much more difficult choices when two households have to live on the same amount of cash flow. When the temporary maintenance and bill paying is set through negotiations or by the court, the focus often then shifts to identifying, securing and valuing all assets including the sometimes serpentine histories of investments sourced in separate property (property owned prior to marriage, inherited, or designated by agreements), and unpacking the information to properly access and value closely held businesses or professional practices. Whatever the size of the marital estate, both spouses are entitled to a fair and reasonable division of the asset, which does not necessarily mean a 50/50 distribution. What is fair under the circumstances calls for presenting evidence on numerous factors and often the use of a Certified Divorce Financial Analysts to illustrate the impact of one division and maintenance package versus the other. The court is to divide property pursuant to RCW 26.09.080 as follows:
In a proceeding for dissolution of the marriage or domestic partnership, legal separation, declaration of invalidity, or in a proceeding for disposition of property following dissolution of the marriage or the domestic partnership by a court which lacked personal jurisdiction over the absent spouse or absent domestic partner or lacked jurisdiction to dispose of the property, the court shall, without regard to misconduct, make such disposition of the property and the liabilities of the parties, either community or separate, as shall appear just and equitable after considering all relevant factors including, but not limited to:
(1) The nature and extent of the community property;
(2) The nature and extent of the separate property;
(3) The duration of the marriage or domestic partnership; and
(4) The economic circumstances of each spouse or domestic partner at the time the division of property is to become effective, including the desirability of awarding the family home or the right to live therein for reasonable periods to a spouse or domestic partner with whom the children reside the majority of the time.
Due in part to the relatively popular use of stock options in the Puget Sound area, issues regarding the ownership, characterization (community or separate), and valuation of stock options have been significantly clarified in series of published court decisions including In Re Marriage of Short, 125 Wn.2d 865 where a formula was ordered for determining the community portion of the stock options.
Even child support, usually set by a formula, is more difficult to calculate for high income parties. When net income exceeds $12,000.00 per month Courts have discretion to exceed formula caps. There are different methods of extrapolating the formulas to higher incomes, but the methods are not binding on the court and judges often consider lifestyles, needs of the children, and the overall financial packages and financial futures of the parents. Maintenance effects child support calculations. Maintenance is deductible to the paying spouse and income to the receiver, so there are often disputes over adjustments of support in light of the amount of maintenance and tax professionals can often identify “win-win” scenarios.
Most cases, even when high income and/or high net worth, reach settlements through negotiations or mediations but competent and thorough preparation is critical to assure all assets are identified and valued and that all factors are properly analyzed, weighed and considered. Glenn practiced in Seattle and the Puget Sound area for 14 years before moving to Spokane and still takes appropriate cases in Western Washington. Naturally he was continually exposed and continues to be involved in a large number of high income and or high net worth cases involving the issues discussed above.