Complex Asset Division During A California Divorce
California is a community property state, which essentially means any property either you or your spouse acquires while you are married belongs equally to you both. Therefore, if you decide to divorce, this community property must be divided equally between the two of you.
While this process may appear simple at first glance, it is often very complex, especially if you and your spouse own significant assets that must be valued and divided, including:
- Retirement accounts, such as pensions and 401(k)s
- Bank accounts
- Homes, including vacation homes
- Art, jewelry and furniture
Further complicating the divorce and division process is that not all property is subject to division. In fact, any property you owned prior to marriage, or obtained through gift or inheritance, may be considered separate property ― meaning you do not have to divide it with your soon-to-be ex-spouse.
Given this distinction, the crucial first step with any property division is to identify which property is community and which is separate, and then you must place a value upon community property and decide how you want it split between you and your spouse.
Even though a couple is free to attempt to resolve these issues between themselves ― a process typically made easier with the help of their attorneys ― they are often unable to do so if the divorce is contentious, in which case the court will be asked to do it for them. In any event, it is always a good idea to have a lawyer in your corner who has experience with the division of valuable assets.
If you have legal questions about complex asset division, the dedicated professionals at the Law Offices of Lynda Sheridan can help. From our office in Century City, we serve clients throughout Los Angeles and Orange counties. Reach out to us online or call us at 310-272-5357 for a FREE 30-minute telephone consultation.
How Are Businesses Divided During Divorce?
Property division can become increasingly complex if either you or your spouse owns a business or closely held corporation. For instance, even if you owned the business prior to marriage, which would make it separate property, any increase in value of the business during marriage may be considered community property, depending on the circumstances. When it comes to businesses, identifying and parsing out community property versus separate property is never an easy task.
Also, many business owners do not want to sell their businesses during divorce, not to mention the alternative option of running the business with their ex-spouse as a co-owner seems equally dreadful. Fortunately, California law does not require divorcing couples to sell or physically split assets equally, but instead they merely split the net value of all their assets equally. Therefore, if you own a business that is at least partly community property, you can attempt to buy out the other spouse or offer other forms of community property, such as houses or vehicles, to offset the difference.
No matter this situation, however, attorney Lynda Sheridan can explain your legal options regarding business valuation/division as well as the tax consequences of each.