High-asset divorces often involve complicated assets that are less common in standard divorce cases. Various types of trust funds are often split up during high-net-worth splits in Birmingham, but many different factors determine how these funds are actually divvied up. Trusts are established for a variety of reasons, including asset protection and estate planning. When divorce is on the table, you may spend a significant amount of time unraveling the circumstances of your trust funds and determining their future.
Are you considering divorce? It’s crucial to work with an attorney with experience in high-asset divorces. Call Kirk Drennan Law at 205-953-1424 to set up a consultation now.
Different Types of Trusts
Trusts come in different forms, and the type of trust fund you have may determine how it will be handled during divorce. Revocable trusts allow the grantor to make changes at any point, including the transfer or removal of assets. Because the grantor has full access to the assets held within the trust, this type of trust is often subject to division during divorce.
Irrevocable trusts are much harder for the grantor to access and alter. Typically, once assets are transferred into an irrevocable trust, the grantor has no access or right to them. As a result, these trusts are often exempt from division during divorce.
There are numerous other types of trusts in addition to these main two. Whether or not yours are subject to division is largely dependent on the terms of the trust and when it was acquired.
The timeline of each trust fund can also affect how it is handled during divorce. A trust fund acquired prior to a marriage may be considered the sole property of the spouse who brought it into the marriage. However, a fund established during the course of the marriage is likely to be viewed as marital property.
Proper Valuation of Trust Funds
If a trust fund is subject to division during divorce, getting an accurate valuation is essential. In addition to working with financial experts who can provide insight into the value of your trust fund, your attorney may look at several different factors. They may look at who made contributions to the trust and where those contributions came from.
This doesn’t mean that the person who made the financial contributions will automatically get the trust. Consider a marriage involving a working spouse and a homemaker. While the homemaker may not have made financial contributions to a trust fund, the court will look at their non-financial contributions.
The intention of the trust will also come into play. For example, if it was created with the couple’s children in mind, the court may be careful about how they handle it and who has access.
Challenges You May Face in a Homewood High-Asset Divorce
When divorce is imminent, some individuals go to great lengths to secure assets. This may include setting up a trust in order to protect assets from division. They may create the trust and move assets to it with the intent of getting them back after the divorce is finalized. If you’re concerned about your spouse doing this, alert your attorney, and don’t worry. High-asset divorce lawyers in Birmingham and the courts have seen a multitude of tricks used to hide assets, and your spouse’s efforts will not go unnoticed.
Commingling of assets can also complicate the division of your trust fund. Consider a trust fund brought into the marriage, which would typically be a separate asset. Perhaps payments from the trust have been deposited into joint accounts or used to pay marital debts and obligations. This could turn a separate asset into a marital asset, making it subject to division.
Regardless of the hurdles you face in your divorce, there are always options available to you. While high-value assets may draw out the negotiation process, there are numerous ways to secure a division of assets that meets your needs.
Start Your Birmingham Divorce with Kirk Drennan Law
Whenever you’re ready to move forward with your divorce and come up with a plan that protects your future, the team at Kirk Drennan Law is here for you. Schedule a consultation now by getting in touch online or calling us at 205-953-1424.