When parties have significant net worth and income, there are usually a multitude of specific challenges that present themselves in divorce litigation.

 

One issue that frequently arises in high net worth and income cases concerns the division of assets through equitable distribution. In many high net worth cases, the parties are frequently recipients of a sizable inheritance or receive income as a beneficiary of a trust.  New Jersey case law provides that both inheritances or trust interests are not automatically subject to distribution to your soon-to-be ex-spouse.  As this is the case, many issues need to be examined to determine the true nature of the possible exemption of either an inheritance or trust from equitable distribution. 

 

The most relevant factor for purposes of equitable distribution of either an inheritance or trust interest remains whether or not the funds received from either instrument were “commingled”.  Funds are often deemed commingled when they moved from a separate account interest into a joint account or into a joint asset.  One example of commingling would be the deposit of inherited monies into a jointly held account or utilizing inherited funds to make improvements for a residence that is clearly jointly held by the parties. Courts will often look at such decisions as affirmative steps that classify once exempt monies into jointly held assets.

 

An additional issue that frequently arises in high net worth and income cases concerns the establishment of an appropriate child support obligation.  The New Jersey Child Support Guidelines only establish a support amount for parties that earn less than a combined net yearly income of $187,200.00.  Once the Child Support Guidelines reach their annual net income threshold, the Court has the discretion to enter an appropriate amount of child support that is commensurate with the additional financial needs of the children. 

 

For example, if a child has specific medical needs or is involved in an extracurricular activity that requires a significant financial commitment, the Court will factor this in when assigning a supplemental child support award.  It is important to note that both parties will more than likely need to recreate and isolate a budget for the children’s portion of the family expenses to properly development a child support obligation when the parties’ combined net income exceeds the threshold amount of $187,200.00 per year.

 

These are just two brief and limited examples of issues that may arise in high net worth divorces.  Our family law group at Stark & Stark has decades of experience of handling the complexities and challenges that present themselves in high net worth divorces.  With our experience and relationships with the most qualified financial experts, trusting our firm to represent you in your divorce matter will ensure that you receive the best results.