How long does it take to finalize a high asset divorce in California?
Since there is no strict legal definition of a high asset divorce, a good rule of thumb is that when the combined assets of the spouses amount to at least $1 million, the divorce is considered high-asset.
In California, there is a minimum period of six months before any divorce can be finalized. However, if spouses disagree on issues such as asset division, spousal support, child custody, or child support, the divorce becomes contested, significantly lengthening the timeline.
- In an uncontested divorce, spouses agree on all matters. An uncontested divorce can move forward much more quickly, even in high net worth cases, significantly reducing the overall timeline.
- In a contested divorce, disputes can extend litigation by months or even years. A contested, high net worth divorce often involves complex financial valuations, intensive negotiations, motions to preserve assets, multiple hearings, and sometimes a trial.
Asset Valuation
California is a community property state, which means that all assets and debts acquired by each spouse over the course of marriage are generally divided equally in the event of divorce. This may sound straightforward, but in reality, it is anything but simple—especially without a prenuptial agreement.
Community property may include:
- Business ownership interests
- Primary residence or vacation homes
- Real estate investments
- Restricted stock units (RSUs) and stock options
- Stock portfolios
- Retirement accounts (401k, IRA)
- Intellectual property (patents, influencer social media accounts) or royalties
- Luxury items (artwork, jewelry)
- Vehicles (cars, boats, planes)
The timeline of a divorce may be prolonged if spouses are business co-owners, or if disputes arise over the valuation of assets. Kaspar & Lugay LLP lawyers have successfully guided high-asset clients through these complex challenges, ensuring they are fully supported throughout the process. We work closely with a trusted network of professionals (including appraisers, valuation experts, corporate attorneys, tax specialists, and forensic accountants) to address the issues that often arise in high-asset divorces.
Spousal Support
Spousal support, also called alimony, is paid by the higher-earning spouse to help the lower-earning spouse maintain a standard of living similar to that of the lifestyle enjoyed during marriage.
Spousal support may be temporary or permanent. Temporary spousal support provides immediate financial assistance during divorce proceedings. Permanent spousal support may be ordered at the end of divorce proceedings. It is long-term, but not indefinite; it can be modified.
In California, if the marriage lasted less than 10 years, the permanent spousal support period is typically half the length of the marriage. If the marriage lasted 10 years or more, the court may order permanent spousal support without a specific end date.
Determining the spousal support amount and duration in a high-asset divorce often takes longer because:
- One spouse may earn significantly more than the other, and the receiving spouse is entitled to support that reflects the higher standard of living established during the marriage.
- Comprehensive financial analysis is required and the lifestyle established during marriage must be carefully considered. Extended negotiations are often necessary to reach an agreement.
- A spouse may agree to transfer their share of certain community assets as part of their divorce settlement to help reduce ongoing spousal support obligations.
Child Custody & Support
The court’s primary consideration in determining custody and child support is always the best interests of the child. California also uses the Income Shares Model to calculate child support amounts based on the incomes of both parents. The idea behind this model is that the financial support from each parent should be similar to what they would provide if both parents were living in the same household. For example, if one parent earns two-thirds of the combined income of both parents, that parent would typically be responsible for covering two-thirds of the child-related expenses.
Child custody and child support disputes can extend the timeline of a divorce for several reasons:
- A comprehensive parenting plan is crucial for minimizing conflicts and providing clarity for both parents and children. Parents of high net worth families may have more complex arrangements for their children’s lifestyle, which can take additional time to formalize into a parenting plan.
- Child support is directly influenced by the timeshare specified in the parenting plan.
- Determining child support in high net worth families can take longer because parents often aim to maintain a lifestyle for their children that reflects their elevated standard of living. Private school, extracurricular activities, household staff, nannies, and other significant expenses need to be thoroughly considered and calculated.
Hidden Assets or Financial Fraud
Forensic accounting is crucial in a high-asset divorce, as investigations can uncover alarming amounts of undisclosed marital assets, such as a spouse’s company shares or cryptocurrency holdings. Kaspar & Lugay LLP attorneys use a number of strategies to resolve these issues, especially where one spouse may earn more or have more financial knowledge than the other.
- Detailed Financial Disclosure: Request comprehensive disclosures from both parties to identify potential hidden assets.
- Tracing Asset Acquisition: Track how and when assets were acquired to establish whether they are community property, separate property, or commingled.
- Document Examination: Scrutinize tax returns, bank statements, investment portfolios, and other financial records for inconsistencies or undisclosed assets.
- Financial Statement Analysis: Analyze income statements, cash flow statements, and balance sheets of a business to determine its fair value.
- Expert Appraisals & Valuation: Accurately assess asset values with business appraisers, real estate experts, or valuation specialists.
- Forensic Accounting: Analyze income, cash flow, and transactions to detect hidden funds or fraudulent transfers. Review spending patterns to determine whether expenses are legitimate or suggest concealed fraud. Forensic accountants may uncover discrepancies, such as a spouse maintaining a lifestyle of extravagant purchases on a seemingly modest income.
- Discovery & Subpoenas: Obtain records from banks, investment firms, and other institutions; may involve court motions to compel compliance.
- Depositions: Question the other party or third parties under oath to clarify financial matters.
Call Kaspar & Lugay LLP Family Law Attorneys
When a marital settlement agreement cannot be reached, our trial-proven lawyers know how to build a winning court case. Our firm combines business law expertise, extensive experience in business and commercial litigation, and deep insights forged in the Bay Area tech startup ecosystem. Kaspar & Lugay LLP Partner Brent Kaspar is a Certified Public Accountant (CPA), and Partner Arvin Lugay has advised and represented some of the most prestigious financial and banking institutions in the country in high-stakes litigation.
We are dedicated to protecting what you are legally entitled to. Contact us today to schedule a consultation.
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