How Are Complex Assets Valued and Divided in Divorce?

assetsIllinois couples getting divorced will have to divide their marital assets. Before an asset can be divided, however, it needs to be accurately valued. Certain assets, such as vehicles, can be valued quite easily. Other assets, like collectibles, businesses, and rental properties, are more difficult to value and divide.

This is especially true when the assets, or the individuals who own them, have a high net worth. Divorcing couples often need the help of outside experts who have experience finding out the value of particular types of assets. In this blog, we will answer common questions about complex assets in an Illinois divorce.

What Makes an Asset Complex?

A car’s value cannot be determined by dividing the car into separate parts that can be individually valued and sold. Rather, a car’s value is estimated by simply looking at similar cars that have sold recently in the area. A car is not a complex asset.

In contrast, complex assets are made up of several components, and each of these components may need to be individually valued in order to determine the value of the overall asset. One of the most common complex assets is a closely held family business. Among the things that must be valued are the business’s assets and debts, the business’s local reputation, and the business’s contracts.

Retirement and pension accounts are further examples of complex assets. Financial portfolios may be allocated in many different areas, each with its own level of risk exposure. Couples getting divorced will have to obtain the overall value of their portfolios, and then weigh the advantages and disadvantages of negotiating for assets they hope to keep rather than liquidating and dividing them.

How Is a Complex Asset’s Value Determined?

One of the challenges of valuing a complex asset is the tendency for the asset’s value to change. For example, the value of a stock portfolio can shift dramatically up or down in just a week. Compounding this challenge is the fact that the true value of a stock option – for example, stock options that are part of a compensation package given in exchange for many years of work – cannot be determined until the option is exercised.

Couples with complex assets usually hire outside financial professionals to help them. Specialists who can assess the value of a unique collectible item, accountants who specialize in assessing a business’s value, and forensic accountants who know how to determine which part of a financial portfolio is considered marital or nonmarital may all be of assistance.

Contact an Arlington Heights Asset Division Lawyer

Accurately valuing your assets during divorce is an important step in ensuring you get the portion of your marital assets to which you are entitled. Donald J. Cosley, an experienced Rolling Meadows, IL divorce attorney, can help you create a professional team that will help you through every step of the property division process. Call Cosley Law Office at 847-253-3100 to schedule your free, confidential consultation today.

 

Source:

https://www.ilga.gov/legislation/ilcs/ilcs4.asp?DocName=075000050HPt%2E+V&ActID=2086&ChapterID=59&SeqStart=6200000&SeqEnd=8675000

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