How Does a High Net Worth Divorce Work in New York?

New York City isn’t just a cultural and financial hub—it’s also home to some of the wealthiest individuals in the world. With over 350,000 millionaires, the city holds more private wealth than most countries. Yet, even among the elite, marriages sometimes come to an end.

If you’re going through a high net worth divorce, you might feel overwhelmed by what lies ahead. The thought of dividing assets like luxury homes, thriving businesses, or extensive investments can feel like more than just a legal challenge—it’s a deeply personal and emotional experience. Beyond the numbers, these decisions impact your future, your family, and the lifestyle you’ve worked hard to build.

How do you move forward when so much is at stake? In this blog, a high asset divorce attorney from Hedayati Law Group, P.C. provides an overview of high net worth divorces in New York– including what you need to know about the division of assets, child custody and support, and protecting your privacy.

What Is a High Net Worth Divorce?

A high net worth divorce generally refers to cases where the marital estate includes significant assets. While there’s no universal dollar amount defining these cases, they often involve:

• Real estate holdings such as multiple properties, vacation homes, or investment properties
• Business interests, including privately owned businesses or partnerships
• Large investment portfolios with stocks, bonds, and mutual funds
• High-value personal property, such as luxury cars, art collections, or jewelry
• Retirement accounts or pensions with substantial value
• Offshore accounts or other hidden assets that may require discovery

Given the complexity of dividing these assets, high net worth divorces demand careful analysis of financial records and a strategic approach to negotiations.

The Statement of Net Worth

In New York, both spouses are required to complete a Statement of Net Worth during the divorce process. This document provides a detailed overview of your income, expenses, assets, and liabilities. For high net worth divorces, completing this statement accurately is essential to ensuring a fair outcome.

Components of the Statement of Net Worth

• Income and Expenses: List all sources of income and document regular expenses to establish your financial needs and contributions.
• Assets and Liabilities: Include a comprehensive list of your properties, investments, debts, and other financial obligations.

Mistakes or omissions on this statement can have serious legal consequences, so it’s important to approach it with care and, if necessary, consult with financial experts.

Asset Division Under New York’s Equitable Distribution Laws

New York follows the principle of equitable distribution, which divides marital property fairly but not necessarily equally. Marital property includes most assets acquired during the marriage, while separate property—such as inheritances or assets owned before the marriage—typically remains with the original owner.

Steps in Asset Division

• Identifying Marital vs. Separate Property: Determine which assets are subject to division. For example, inherited property commingled with marital funds may be considered marital property.
• Valuing Assets: Assess the value of marital assets, often with the help of appraisers or financial experts.
• Dividing Based on Fairness: Courts consider factors such as:
  • The length of the marriage
  • Each spouse’s financial and non-financial contributions
  • The future financial needs of each party
  • The standard of living established during the marriage

Addressing Complex Assets and Tax Implications

High net worth divorces often involve unique assets that require specialized evaluation and careful planning to minimize tax liabilities:

• Stock Options and Deferred Compensation: Assess future value and payout timelines to achieve fairness.
• Cryptocurrency: Verify accurate valuation and transparency to avoid reporting challenges.
• Business Interests: Evaluate ownership stakes, earnings potential, and associated tax implications.
• Real Estate or Investments: Selling assets to divide proceeds may trigger capital gains taxes.

Collaborating with financial experts and tax professionals ensures fair asset division while protecting your financial future.

Spousal Maintenance in High Net Worth Cases

Spousal maintenance, also known as alimony, is often a significant factor in high net worth divorces. The court’s goal is to balance the financial needs of the spouse requesting support with the other spouse’s ability to pay.

Factors That Influence Maintenance Awards

• The length of the marriage
• The earning capacity and future financial prospects of each spouse
• The standard of living established during the marriage
• Contributions made by one spouse to the other’s career or education

In cases involving substantial wealth, spousal maintenance awards may reflect the couple’s affluent lifestyle, which can lead to larger payments compared to typical divorces.

Child Custody and Support

If children are involved, custody and support arrangements take priority. New York courts focus on the best interests of the child, considering:

• Parenting abilities
• Living arrangements
• Each parent’s availability to care for the child

For child support, the court calculates amounts based on both parents’ combined income. When income exceeds $183,000 (the statutory cap), the court may adjust payments to account for additional expenses such as private school tuition, extracurricular activities, and health care costs.

Protecting Your Privacy

High net worth divorces often attract public attention, particularly when substantial wealth or prominent individuals are involved. Protecting your privacy during this process is essential to maintaining control over sensitive financial and personal information, as well as reducing unnecessary stress.

Strategies for Protecting Privacy

• Mediation or Arbitration: These private alternatives to court proceedings keep the details of your divorce out of public records. This means you can resolve disputes without exposing financial disclosures or personal matters to public scrutiny.
• Confidentiality Agreements: Both parties can agree to keep specific information confidential, such as the terms of your settlement or asset valuations, protecting your reputation and financial security.
• Sealing Court Records: In some cases, courts may seal certain records to limit public access.

Taking these steps allows you to focus on the important decisions at hand without the distraction of public attention. A skilled attorney can help you implement these privacy protections and develop a plan that minimizes exposure while keeping your financial interests secure.

High net worth divorces in New York involve a unique set of challenges, from valuing complex assets to addressing privacy concerns. By understanding the process and preparing strategically, you can protect your interests and work toward a resolution that reflects your financial goals. For tailored advice, consult with a high asset divorce lawyer to help you make informed decisions.

Protect Your Assets with Strategic Legal Guidance

Facing a high net worth divorce can feel overwhelming, especially when so much is at stake. At Hedayati Law Group, P.C., we understand the stress that comes with dividing substantial wealth, and we are here to provide the clarity and strategic guidance you need. With over 150 years of combined experience and backgrounds in banking and finance, our New York divorce attorneys bring a unique ability to address complex financial and legal issues that many firms cannot match.

Whether you’re dealing with high-value assets like real estate, businesses, or investments, we take the time to develop personalized strategies tailored to your goals. We can assist with: valuing and dividing assets fairly while protecting your financial future, addressing spousal support and child-related financial considerations, safeguarding your privacy during what can feel like a very public process, and the emotional and financial complexities unique to your case.

Serving clients throughout Suffolk County, Nassau County, and New York City, we’re committed to helping you make informed decisions at every step. Your financial security and peace of mind matter to us.

Take control of your next steps today. Call us at (516) 334-4100(516) 334-4100 or complete our confidential online form to schedule a confidential consultation. Together, we can build a plan that protects what matters most to you.

Copyright © 2024. Hedayati Law Group, P.C.  All rights reserved.

The information in this blog post (“post”) is provided for general informational purposes only and may not reflect the current law in your jurisdiction. No information in this post should be construed as legal advice from the individual author or the law firm, nor is it intended to be a substitute for legal counsel on any subject matter. No reader of this post should act or refrain from acting based on any information included in or accessible through this post without seeking the appropriate legal or other professional advice on the particular facts and circumstances at issue from a lawyer licensed in the recipient’s state, country, or other appropriate licensing jurisdiction.

Hedayati Law Group, P.C.
666 Old Country Road Suite 444
Garden City, New York 11530
(516) 334-4100(516) 334-4100
https://hedayatilaw.com/