Divorcing spouses typically obtain or exchange information about each other’s incomes, assets, and debts acquired during the marriage. This process, called “discovery,” includes things like bank statements, credit card statements, and employment records.
Accurate values for assets like your home or business, however, might require outside professionals like appraisers or accountants.
While you might be familiar with certain financial assets in your spouse’s name, it’s likewise important to consider these 4 types of assets commonly overlooked in divorce:
1. Stock Options & Restricted Stock
Corporations are increasingly granting stock options as compensation for past or future services. Likewise, costly litigation can arise over whether stock options are marital assets, and if so, how they should be valued and divided. It’s therefore important to know how these assets are valued and divided when negotiating your divorce agreement.
2. Capital Loss Carryover
Generally, if the sale of an investment or capital asset like a piece of real estate resulted in a loss, it can be used to offset capital gains, or otherwise, to lower ordinary income tax liability.
Capital losses can be carried forward into subsequent years as needed until they are fully deducted. For example, in a recent divorce case, I represented the wife whose husband had carried over losses claimed for commercial real estate on his separate income tax returns for several years. Yet, in the divorce, the husband wanted the wife to share in tax liability when the properties were sold. If the Wife had agreed, it would have cost her tens of thousands of dollars and, fortunately, we were able to resolve this issue out of court.
3. Collections and Memorabilia
Personal property is an area where potentially valuable assets can easily be overlooked. It’s important to consider these potentially valuable items to divide in the divorce:
- Jewelry
- Furs
- Collections of coins or stamps
- Guns or other weapons
- Recreational vehicles
- Artwork
- Antiques
- Sports memorabilia and trading cards
- Classic cars
- Fine wines
4. Credit Card Reward Points
When dividing up assets in a divorce, it can be easy to overlook credit card rewards points. Generally, credit card rewards earned during the marriage can be considered a marital asset, regardless of which spouse earned them.
The above assets are just some that can have significant value and easily get overlooked when dividing assets in divorce.
It’s therefore important to consult with an experienced family lawyer to make sure you don’t walk away from potentially large amounts of money in your divorce.
Like this post? Sign up to receive our newsletter and receive more tips, updates, advice, and inspiration right to your inbox.