Asset Protection Attorney Miami
The best way to protect your assets is to do so in advance (in case of a future divorce) through a well-prepared premarital agreement. However, too often, even in high net worth situations, these agreements are overlooked. If you are already married, but without a properly prepared premarital agreement (often called a pre-nuptial agreement), there are other ways to protect your assets.
When a party is contemplating divorce it is important to conduct a thorough inventory of your financials including stock accounts, retirement accounts, real estate assets, business interests and anything of value that is in your portfolio, such as jewelry, cars, and other high value assets. Next, assets need to be divided into ‘premarital’ and ‘marital’. Premarital (or ‘non-marital’) assets are those assets that were owned by one of the spouses prior to the date of the marriage. Marital assets are those assets acquired during the marriage. After all the assets are listed and are categorized as marital or non-marital, a valuation should be determined for each of the assets that are not readily determinable, i.e., a current appraisal for real estate or assets whose value may have changed since the marriage.
If any of the assets were premarital, then an evaluation needs to be conducted on whether there has been any increase in their value during the marriage since the date of the marriage. If the increase in value is “passive” – as a result of the market without any active participation on the part of the spouse, then this increase should not be included in the marital share; i.e., the other spouse is not entitled to share in this increase. If, on the other hand, the increase in value is as a result of “active” appreciation – the efforts of one or both of the spouses; i.e. spending marital funds to improve real estate or actively trading stocks, then the increase in value is considered marital and will be awarded as part of the marital share.
There are many nuances in the law in determining whether all or part of an asset is within the marital estate and subject to division. If you are spouse who is seeking all or most of an asset’s value, it is important to consult with an attorney as soon as possible to enable the attorney to help you begin gathering the factual information necessary to prove that your share should be greater than the other spouse by virtue of the active or passive appreciation of an asset.
There are other methods to shield assets from being divided as part of a marital estate. One such method is through an irrevocable trust. An irrevocable trust is a trust that can’t be modified or terminated without the permission of the beneficiary. The grantor, having transferred assets into the trust, effectively removes all of his or her rights of ownership to the assets and the trust. However, it is important that the creation of the trust be done in such a manner as not to constitute a fraudulent transfer. After the institution of divorce proceedings, any transfers could be considered fraudulent.
In summary, it is extremely important if you are considering a divorce and have numerous assets you want to protect for you to contact an attorney as soon as possible to ensure that you have an effectively planned strategy prior to the commencement of the court proceedings. Contact us if you are concerned about asset protection, or are contemplating or in the midst of a high net worth divorce action.