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How to Get Divorced When Your Spouse Is a Millionaire

Millionaire in elegant suit smokes and drinks on luxurious sofa.

When divorcing a millionaire, a person has the additional burden of understanding the many and often complicated financial holdings. If the well-heeled spouse is a high-powered executive, for instance, it’s important for divorcees to know about stock options and restricted stock plans. Stock options are considered assets that can be divided between spouses in a divorce.

Millionaire in elegant suit smokes and drinks on luxurious sofa.

Keeping Tabs on Stock Portfolio

Executives and key employees sometimes have stock options and restricted stock plans. Stock options have vesting periods, meaning the employee may have one to five years to exercise them. Stock plans are prevalent in divorce negotiations.

Stock division can get messy because most employers restrict the transfer of stock options to another person, even when it’s for divorce purposes. The employee spouse can, however, hold the stock portfolio in a constructive trust for the benefit of the non-employee spouse. This must be included in the settlement agreement to protect the non-employee spouse.

Tax ramifications will also have to be addressed in the legal agreement. When shares are exercised or sold, the millionaire spouse is responsible for paying taxes even if he or she transfers the proceeds to the non-employee spouse.

Finding Hidden Incentive Compensation Plans

Unvested restricted stock or unexercised stock options typically do not show up on a paycheck or tax return, making them tough to track down during a divorce. A spouse may use this as a loophole to hide assets. With several documents, however, a high net worth divorce lawyer may be able to discover hidden gems. These include the incentive compensation plan documents, annual award benefit statements, and award letters. 

Having Important Financial Documents

If a person doesn’t know how much the wealthy spouse makes or what he or she owns, they might end up settling for less. Before the divorce proceedings, a person should start paying more attention and keeping important financial records, such as recent statements of net worth or proof of stock ownership.

Seeking a High Net Worth Divorce Lawyer’s Opinion

When a couple owns property together and has disparate incomes, finding legal counsel is the best course of action. Most high-net-worth divorce attorneys will offer a free initial consultation. During the meeting, the lawyer will review all the financial documents and assets. Considerations will be based on how long the marriage lasted, each spouse’s earning potential, and the type of marital property owned by the couple.

Uncontested divorce lawyer Denise Erlich is passionate about helping divorcing couples in the greater Chicagoland area transition to their new life as seamlessly as possible. Ms. Erlich patiently guides her clients through every step of the divorce process and provides clients with candid advice about their case and legal options, so they can make informed decisions about their future.

Years of Experience: More than 20 years
Illinois Registration Status: Active
Bar & Court Admissions: Illinois State Bar Association U.S. District Court, Northern District of Illinois
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