Dividing Investments Upon Divorce

If you are considering divorce, or are already in the midst of getting one, it is critically important that you understand Michigan rules regarding the division of marital property. Many clients believe that they are not entitled to a share of a specific account or piece of property because it is "in [the spouse's] name." This is, quite simply, wrong. There are circumstances when property is determined to be separate, but it has nothing to do with whose name is on the papers.

Separate property and marital property

Some property is seen as separate property. This includes any property that either spouse brought into the marriage or the value of an inheritance, even if it was received during the marriage. However, if you commingle the separate property with joint property - if you deposit the amount of the inheritance into a joint account, for example - then it may be considered marital property.

In many cases, it is hard to decide what portion of an investment is marital property. What if one party came into the marriage with a house but it was improved with funds that are marital property? What if there were no improvements but the property appreciated greatly during the marriage due to market forces? These kinds of questions demonstrate that even financially savvy people should never try to settle their divorce without professional advice. This does not mean that you have to litigate your divorce, but you must understand all the circumstances under which you may be entitled to a share of an investment.

How to value an investment

If you have an investment account that consists of stocks or bonds, the account's value can be determined by looking at a statement. If you own real estate or other collectibles, it can be appraised by an expert. Different experts can value the same asset differently, but there are basic principles that they will follow.

If your property includes the value of a professional license or a share of a closely held business, valuing it is much more difficult. There are formulas and guidelines that are accepted by forensic accountants, but two experts can arrive at very different valuations. Retirement accounts and pension plans are also difficult to value, especially if you are not scheduled to retire for a significant period. There are also formulas that an expert can use, but the question of what assumptions to use in estimating future inflation and interest rates affects the results.

If you are considering divorce, it is extremely important that you consult an attorney who is experienced in family law cases and the particular issues raised by high net worth divorces. You may be surprised how much you are worth when you add up all the assets you have, from your house to your engagement ring to your professional license and retirement accounts. The Law Offices of Michael A. Robbins has the experience you need to ensure that you receive a fair and equitable distribution of all assets that were acquired during your marriage, no matter in whose name they are titled.