Experienced Grand Asset Division Attorneys Serving West Michigan
For many couples, one of the most highly-contentious aspects of the divorce process involves dividing their joint assets. In Michigan, spouses’ marital assets are subject to “equitable distribution,” which requires a fair – but not necessarily exactly equal – division of property. At Kraayeveld Law, our Grand Rapids asset division attorneys know the law and how to help our clients protect the assets that matter most, whether that means negotiating a settlement or fighting to secure their desired property rights in court.
What is an “Asset” for Michigan Divorce Purposes?
The term is broader than many people assume, at least when used by courts and lawyers in divorce cases.
Generally, everything you own and everything your spouse owns is a form of property. That includes:
- Bank accounts
- Pensions and retirement accounts
- Insurance policies
- Business ownership interests
- Real estate
- Personal property, like vehicles, furniture, artwork, electronics, and jewelry
- Stock options
- Digital assets
These and other assets must all be classified as either marital or separate property.
What is the Difference Between Separate and Marital Property in Michigan?
When addressing the division of assets during a divorce in the absence of a prenuptial or postnuptial agreement, one of the first steps is to properly classify all assets as either “separate” or “marital” property. This classification is critical, as marital assets are subject to division while separate assets are usually not.
As a general rule, assets acquired prior to the marriage qualify as separate, as do assets that one spouse acquires during the marriage through either gift or inheritance and are kept separate. Everything else is marital property. But, there are exceptions, and commingling and appreciation of separate assets are among the most common issues that lead to disputes during the divorce process.
Will Marital Property be Split Down the Middle?
Not necessarily. Michigan law requires that property division be “equitable,” not that it be even. Splitting the assets into equal parts is a common option, but various alternatives can be used to ensure fairness and meet each spouse’s needs.
For example, in some situations, spouses may want to keep different marital property, like the family home or a particular car. So, instead of selling the asset and splitting the proceeds, it may be awarded to the spouse as his or her property. That usually comes with an offset of other property or a payout from the source keeping the property to cover the value of the other spouse’s interest in it.
Factors for Dividing Assets in a Michigan Divorce
In order to determine what is “equitable,” Michigan law examines a laundry list of factors relating to the spouse’s financial circumstances and their financial and non-financial contributions during the marriage. While divorcing spouses have a significant amount of flexibility to divide their marital assets into mutually-agreeable terms, in most cases, these factors should guide the spouses’ negotiations and decision-making:
- The length of the marriage
- Each spouse’s contributions to the marital estate
- The spouses’ respective ages, health conditions and life status
- The spouses’ respective financial needs and circumstances
- The spouses’ respective earning capacities
- Each spouse’s conduct during the marriage
- General principles of equity and fairness
Complex Asset Division Issues in High-Net Worth Divorces
Certain types of assets are more difficult to divide than others. For business owners, investors, licensed professionals, and other high-net-worth individuals, ensuring an equitable distribution often requires multiple valuations, strategizing to maintain sole ownership of key assets, and careful assessment of debt and tax-related considerations. At Kraayeveld Law, we have significant experience representing spouses in high asset divorces, and our divorce attorneys routinely advise clients with regard to matters such as:
- Business continuation and valuation
- Valuation of complex assets
- Alimony or spousal support in high-income situations
- Retirement and investment assets
- Hidden or squandered assets
- Personal property valuations
In practice, while some assets get divided, the process of dividing a marital estate often involves each spouse giving up rights to certain assets in exchange for rights to others. Whether you want to protect your business, continue living in your current residence, or secure a portion of your spouse’s retirement savings, our Grand Rapids asset division attorneys can help you achieve the outcome you desire.
Stock Options and Restricted Stock
Stock holdings obtained by one or both spouses during a marriage are generally considered marital property. The analysis is more complicated when it comes to stock options.
If part of the compensation package that you or your spouse earns from work includes stock options or restricted stock units, it is important to understand the full extent of the stock earned and take steps to protect your interest in it.
Generally, employees who hold stock options have the right to purchase company stock at a specific price. Those options are typically granted on a defined vesting schedule. On the other hand, restricted stock is awarded to employees but does not fully vest until certain restrictions (often time) have been met.
Stock options and restricted stock will usually be treated as separate property if acquired before the date of the marriage or after the separation.
More difficult questions arise in two scenarios: 1) Options or restricted stock awarded before the marriage that vest during the marriage, and 2) Options or restricted stock awarded during the marriage that vest after the separation. Some or all of the stock may be considered marital property in these cases.
Some couples use a prenuptial agreement before they are married to resolve how restricted stock or stock options will be handled in the event of a divorce. Others can seek to resolve these thorny questions through a negotiated settlement agreement as part of a divorce.
Financial Disclosures and Hidden Assets
Michigan law requires divorcing spouses to fully disclose their income and assets so that each spouse and the court have a clear and complete understanding of what is on the table. Any one of the Grand Rapids asset division attorneys at our firm can help.
Sadly, in some cases, a spouse may not be telling the whole story about the property they own. That makes it difficult, if not impossible, to ensure that the other spouse is making an informed decision and that the couple’s assets are divided fairly.
Individuals and businesses use all kinds of straw men and smokescreens to cloud their identities in business transactions, whether it is to skirt tax laws or avoid treating certain property as a marital asset. Spouses may try to conceal stocks, bonds and other liquid investments by transferring them to third parties or burying them in offshore accounts.
Commonly concealed assets in divorce cases include:
- Bank accounts
- Business assets and ownership interests
- Retirement accounts
- Real estate investments
- Offshore assets and bank accounts
Our Grand Rapids asset division lawyers know the red flags to look for when it comes to hiding assets and we are well versed in the various schemes that people use to try to pull it off. We have also had significant success uncovering those assets and using Michigan’s discovery process to protect our clients and advance their rights. Our investigators draw on forensic accounting methods to spot income and payments that might otherwise be missed.
Can a Judge Later Revise a Property Division Order?
Not normally. It is unlikely unless both spouses agree to the change. They can amend a marital settlement agreement at any time or go back to court and request that a court order be modified based on a mutual agreement. If a spouse can timely show fraud or mutual mistake, the court might consider revising a property division order.
Judges are otherwise typically hesitant to modify property division decisions following a divorce. That means it is vital to get it right the first time around with the help of a Grand Rapids asset division lawyer at our firm. You must have a full accounting of both spouses’ property and an accurate understanding of what property is a marital asset.
Contact Our Grand Rapids Divorce Lawyers to Properly Manage your Asset Division
If you would like more information about protecting assets in your divorce, please contact us to schedule a confidential initial consultation. To speak with a Grand Rapids divorce lawyer at our family law offices in Grand Rapids, MI, call us at 616-285-0808 or inquire online today.