Suppose you or your spouse is an executive in a company, professional practice, partnership, or other organization. In that case, you may face additional concerns in identifying all the components of income and/or dividing your marital property.
Many executives receive certain bonuses, commission payments, profit shares, stock options, or other perks, either in place of or in addition to a salary or base pay. Such additional compensation and benefits enhance income and the marital estate and will be relevant in divorce. It is important that such benefits not be overlooked. However, it is equally important to distinguish between items that may be classified as property, items that may represent elements of income and potential future entitlements which are too remote or uncertain about falling into either category presently.
From Kathleen’s interview for the Masters of Family Law series on ReelLawyers.com
Putting A Value On Perks And Special Compensation
At Hogan Omidi, PC, our lawyers understand how these issues factor into a high-asset divorce. We have guided hundreds of executives and professionals, as well as spouses of executives and professionals, in the Denver metro area and throughout Colorado through their divorces.
Our attorneys have experience dealing with the unusual elements of income or assets of business executives, professionals, and business owners, including:
- Company stock
- Stock options, restricted stock, stock appreciation rights, and other stock-based grants
- “Golden parachute” payouts or benefits
- Signing bonuses
- Retention or productivity bonuses
- Car, phone, or travel allowances
- Vacation plans or allowances
- Severance agreements
- Noncompete clauses and employment contracts
Many executives and professionals have agreements with their companies or partnerships for when they retire or leave the company. Even if this has not happened yet, and will not happen for a while, we must gauge the value of these agreements in your current situation.
How Do These Issues Factor In My Divorce?
The types of benefits or perks mentioned above may have potential value. They may be treated as assets or incorporated into the income of the person receiving them. For the Executive or business owner, it is important to ensure that such items are not improperly double-counted both as an asset and as an element of income. It is also important to ensure that items not certain to be received are not treated in the same fashion as present entitlements.
Some extras may also affect the income figure for calculating things like alimony or child support. It is important to work with a lawyer who can guard against having the same benefit treated as an asset and an element of income.
We deal with these unique situations as they arise in your divorce proceedings. We may be able to use some of these issues in negotiations with your spouse and their attorney. We will review your financial situation and that of your spouse and advise you on how to proceed.
We Know How To Incorporate These Issues Into A Final Settlement Agreement
Creative solutions for fairly dealing with these kinds of benefits and entitlements are most likely to come from lawyers who understand the challenges of identifying and appropriately addressing elements of executive compensation.
Call us to schedule a consultation at 303-691-9600 or contact us online. We have offices in Cherry Creek and Aspen and serve clients all over Colorado.