If you have a high net worth or many assets in a divorce, your separation may pose unique issues. While most divorces involve a house and cars, high-net-worth divorces go beyond the typical assets. You may have investment portfolios, offshore accounts, multiple properties, and other valuable assets that must be divided. This may leave you wondering what counts as a high-net-worth divorce in Austin.
It’s most beneficial to work with a high asset divorce attorney who understands your situation and can use Texas divorce laws to your benefit.
What Makes a Divorce High Net Worth?
This is one of the first questions many divorcing spouses ask, and many believe the distinction is attached to a single dollar amount. While gross income and totals are important, Texas divorce laws focus less on headlines and more on complexity.
High-net-worth divorce cases typically include components such as businesses, complex investments, multiple properties, executive compensation, or assets that are hard to value or divide. Understanding what Texas courts consider high net worth can help you set expectations and avoid expensive early mistakes.
Divorce is common among affluent Texans, and high-net-worth cases are frequent in Austin. Our city is home to thriving technology, booming real estate, and entrepreneurial markets. Every complex case is different, but high-net-worth divorces require insight, planning, and an intimate knowledge of how judges view underlying property interests rather than flashy wealth totals.
In Texas, there are approximately 2.1 divorces per 1,000 people, according to the CDC. This was lower than the national rate of 672,502 divorces, resulting in a divorce rate of about 2.4 per 1,000 people in the United States.
Divorce affects couples at different stages of life, as evidenced by the fact that around 22% of American couples left their marriage after 25 years or more, and 16% did so during the first five years. Nearly one-third of Americans claim that their first marriage ended in divorce, demonstrating how common divorce has become over time, with many of them being high-asset divorces.
Here are 10 of the most important things you need to know about high-asset divorces in Texas.
- It Can Take Longer to Get a High-Asset Divorce: While a typical divorce can take anywhere from six months to two years, divorces involving more assets can take even longer. It can take time to identify all the assets that must be considered in a high-asset divorce, especially those a party might be trying to hide. You can’t rush the process in a high-net-worth divorce. Instead, allow your lawyer to go through the process calmly while you focus on moving forward with life.
- Spouses Often Try to Hide Assets: Division of assets and liabilities is typically one of the most contested issues in high-net-worth divorces. However, you must be honest about all your assets. If either party attempts to hide assets, the court will view their actions negatively throughout the remainder of the case. Instead, present a strong argument for why specific assets should be reserved for you. You can also negotiate possession with your ex in exchange for something they may want to keep.
- You Are Entitled to a “Just and Right” Division of Community Property: In Texas, all property possessed by spouses during or upon dissolution of the marriage is considered community property. Community property is owned equally by both parties during the marriage. However, property need not be divided equally. The court will divide community property in a “just and right” manner. Your divorce lawyer can help you present arguments regarding the way in which your assets should be split.
- Businesses Are Often Considered Community Property: Many spouses contribute to a family business to help it develop over time. When both parties have worked to grow a business, it is considered community property. Division of a business can be complicated and requires valuation, which often requires the assistance of financial professionals. The interests of both spouses will be considered in the division of property.
- There Are Special Child Support Considerations for High Earners: If you make a significant amount of income, then you may make more than what the Texas child support guidelines consider. There are special child support statutes that apply to high-earning individuals in Texas. In some circumstances, an individual may be ordered to pay more than the guidelines specify.However, the parent with primary physical custody must prove that the child’s needs are greater than the amount indicated in the statute. A high-asset divorce lawyer can help you determine how much child support is fair in your specific situation.
- Alimony Will Consider All of the Payor’s Income: People with higher-than-average earnings often have multiple streams of income. This can make it difficult to determine a fair alimony (also called “spousal maintenance”) amount. In fact, some spouses aren’t even aware of all the sources of their partner’s earnings. An alimony lawyer can help you identify which earnings should be considered and how much alimony should be awarded.
- Prenuptial Agreements Are Not Always Upheld: If you decide to divorce your spouse and have a prenuptial agreement, you might think you already know how things will play out. However, prenuptial agreements are not always upheld. In some cases, certain clauses may not be relevant, or the judge may believe duress or fraud was involved. If you signed a prenuptial agreement and are now looking at divorce, you need to discuss your marital contract with a divorce attorney.
- The Court Has the Discretion to Decide Some Assets Cannot Be Divided: In Texas, all community property is subject to “just and right” division during a divorce. That does not mean that every item must be valued, sold, and split evenly. If you acquired valuable art, jewelry, or other items during your marriage, the court may grant you ownership of those assets while your ex gets other property. The court’s goal is to divide things equitably, not necessarily equally.
- You Can Keep Sensitive Information Private During a Divorce: While a divorce is made public, the details of your sensitive information may be kept separately from the public case file. For example, your financial statements can be redacted or otherwise hidden so that the information is not readily available to anyone looking up your divorce. You should be careful what you include in pleadings and other legal documents filed with the court. Make sure you request redacted information when necessary.
- How Can I Pay for a Divorce Attorney if My Spouse Closes Our Joint Accounts?: The money you and your spouse earn during the marriage is considered community property. If that money goes into a joint account, then you both have access to it. One manipulative tactic a spouse may use is to withdraw money from joint accounts and close them. If this happens to you, you can request relief from the court to get your equitable portion of that money back. You can pay your legal fees out of marital property accounts.
Net Worth vs. Marital Estate
It’s normal for spouses to view divorce through the lens of net worth. The number provides a snapshot view of your entire financial standing. Texas divorce proceedings maintain that net worth is not distributed between parties. They divide legal interests in property.
While the community estate is related to net worth, it’s not directly calculated as assets minus liabilities. Instead, courts ask questions like:
- What assets are considered community property vs. separate property?
- How was each asset acquired?
- How should each asset be valued?
- What is a fair division of the community estate?
A skilled high-net-worth divorce lawyer won’t focus only on your net worth. Instead, they will analyze:
- Acquisition dates
- Commingling of funds
- Appreciation and income during marriage
- Tracing to prove separate property
- Restrictions on sale or transfer
Potentially liquid net worth can look drastically different when you consider restrictions on community property. Someone could have a high net worth but few assets available to pay divorce debts, such as property division or spousal support.
Illiquid Assets Define Many High-Net-Worth Divorce Cases
Many divorces in Austin revolve around illiquid assets. Illiquid means the property cannot be easily sold, divided, or accessed without tax or financial consequences. Some common examples are:
- Businesses
- Investments
- Stocks
- Bonuses
- Partnerships
Illiquid assets require special handling. How a divorce settlement is structured can be just as important as the valuation. For example, if a divorcing couple owns a business together, one spouse may keep the business while the other receives different assets to equalize value.
If cash or other compensation is given, it may be divided over time to reduce tax burdens. Either scenario requires careful planning. If a couple does not agree, a judge could force the business to be sold much earlier than anticipated.
High-Asset Divorce Strategies Are Unique
Every high-net-worth divorce case is unique, but many overlap with intricate tax, business, or financial concerns. High-asset divorces may require:
- Business evaluations
- Forensic accounting reviews
- Real estate appraisals
- Employment compensation analysis
Many clients worry that Texas is an all-or-nothing divorce state. Judges exercise broad power to divide community property in Texas by implementing just and right rules, providing opportunities to customize divorce judgments to your family situation, provided you accurately present your financial details.
Presenting your case effectively requires careful preparation, complete documentation, and strategic timing. It also means protecting your future self and family. That’s where an Austin high-net-worth divorce attorney can help.
Why Hire a High-Net-Worth Divorce Lawyer
When you hire a high-net-worth divorce lawyer in Austin early, you allow your attorney to protect financial records, prevent dissipation of assets, and frame the narrative around your strengths. Approaching your divorce with a strategic mindset will allow you to stay ahead in the process. You’ll avoid many costly mistakes while positioning yourself for a fair, efficient resolution.
FAQs
What Is Considered High Net Worth in Divorce?
High-net-worth divorce does not have a specific dollar amount. Instead, it refers to divorces involving complex assets such as businesses, multiple homes, investments, executive compensation, or trusts. Sometimes, even divorces of middling net worth can be considered high net worth if the assets are hard to value or divide. Texas cares less about the number of marital assets and more about the complexity of the marital estate.
Is Everything Split 50/50 in a Divorce in Texas?
No, Texas is a community property state, but that doesn’t mean assets are split evenly. Community property is divided by the court in a “just and right” manner. This means the court has discretion to divide the property based on earning capacity, fault in the marriage, financial circumstances, and more. A just and right division may be equal, but it’s not required to be.
What Money Cannot Be Touched in a Divorce?
Separate property is not divided during divorce in Texas. This includes property owned before marriage, inheritances, gifts specifically given to you rather than both you and your spouse, and some personal injury awards. However, you must be able to trace the separate property. You cannot commingle it with community property/assets.
Who Loses More Financially in a Divorce?
There is no universal answer to who loses more financially in a divorce. Financially, the outcome depends on the parties’ relative incomes, the composition of their assets, their custody arrangements, and post-divorce requirements. One party may pay support, and the other party may struggle to maintain their standard of living. In high-asset divorces, both parties incur attorneys’ fees and taxes and may no longer have access to the former marital wealth.
It’s Important to Work With a High-Asset Divorce Lawyer
If you are facing a divorce with more assets than many others have, then you have much at stake. You don’t want to lose everything due to a misunderstanding. The Law Office of Ben Carrasco, PLLC, is here to guide you through this process. Call our high-asset divorce lawyer today or contact us online to schedule a consultation.
