Navigating Divorce with a
High-Net-Worth Spouse Struggling with Addiction
Divorce is never easy, no matter what your financial situation is. However, high-net-worth divorces are traditionally far more complex than most divorces. When one spouse is struggling to cope with addiction, it can be even more challenging to navigate the divorce process.
High-net-worth divorces typically involve businesses, significant investments or assets, and tax considerations. Divorces involving addiction are often emotionally taxing and require sensitivity as you work to distribute your marital estate, implement safe parenting plans, and ensure alimony and child support orders don’t leave you destitute.
You need an Atlanta divorce lawyer on your side who has personal experience with the pain and struggles caused by codependency and addiction. Attorney Pete Chambers from Chambers Family Law will handle your high-net-worth divorce that involves addiction, with compassion and understanding.
Our team will ensure we approach your divorce strategically, so your rights are protected and you get the help you need to pick up the pieces of your life.
Challenges Associated with Addiction and High-Net-Worth Divorces
In a high-net-worth divorce, dividing your considerable assets, businesses, and shared debts can be particularly challenging. However, when one spouse is addicted to drugs or alcohol, it can make an already contentious divorce that much more difficult, confusing, and overwhelming.
It is not unusual for one spouse to want to punish or seek retribution against the other, or for one to refuse to accept any responsibility for their part in the dysfunction of the marriage. Pete Chambers, from Chambers Family Law, says, “While it may temporarily feel good to want to punish your spouse, acknowledging and doing the work that you need to do on your own to address and recover from your own codependency is vital to having a healthy future for yourself and being able to leave the marriage without anger, resentments, and with as little animosity as possible.”
Recognizing the challenges that may arise and having an action plan for how to cope with them will be an essential part of our strategy through the divorce process. It is our goal to preserve your wealth, protect your children, and safeguard your assets.
Valuation of Assets
Dividing assets as part of a high-net-worth divorce can be one of the most complex elements of the settlement process. You need a powerful legal advocate on your side who has in-depth insight and knowledge of not only complex financial matters but also the Georgia divorce laws, and who can assemble the right team, including the right financial expert to provide input regarding the assets and tax consequences.
Our team has considerable experience helping our clients safeguard their:
- Retirement accounts, including IRAs, 401(k)s, or pensions
- Real estate holdings, including investment properties, REITs, vacation homes, or your shared residence
- Inherited funds
- Company partnership or ownership interests
- Valuable personal property, including antique or specialty vehicles, collectible items, jewelry, or artwork
- Investment portfolios
Working with highly skilled forensic accountants and valuation experts is the best way to ensure we obtain the true value of your assets and marital and separate property estate, including the tax impact of your assets. While you may have hoped to get your divorce finalized quickly in high-net-worth divorces, you should not trust your ex-spouse at their word when it comes to claiming they have disclosed all assets, or their value of your assets and property.
Attempts to Hide Assets
When your marital estate is worth a considerable sum, the end of your marriage may prompt your spouse to try and hide your assets or take other actions to reduce their value and suppress their income.
Appraisers, financial advisors, and forensic accountants will carefully review your records to determine whether your spouse:
- Overpaid debts
- Overpaid taxes
- Has valuable future tax credits
- Transferred assets to an offshore account
- Recently opened hidden accounts
- Undervalued assets during valuation
- Is suppressing income
- Has income from other/undisclosed sources
If your spouse suffers from substance abuse, they may have hidden accounts that allow them to fund their addiction. You may also be interested in setting aside a portion of your assets to cover an outpatient or inpatient drug or alcohol rehabilitation program.
Tax Considerations
Divorce has serious financial consequences for high-net-worth individuals, particularly those who do not have prenuptial or postnuptial agreements in place. Whether you buy out or sell marital assets, you may need to worry about gains taxes, tax implications when you divide your retirement savings accounts, closing costs of selling real properties, and additional tax liens, interest, or penalties if we discover your spouse has committed tax fraud.
Alimony
Spousal support is not guaranteed in every Georgia divorce. In fact, under Georgia Code § 19-6-1, alimony may not be awarded unless there is a significant income disparity or if one spouse has a much higher net worth than the other. If one spouse earns significantly more than the other, the higher-earning spouse may be ordered to pay alimony.
We see this often if one spouse is the homemaker and therefore financially dependent on the other spouse, who works outside of the home to provide for the family. However, if the lesser-earning spouse is the one struggling with addiction, this concern may be raised as part of your spousal maintenance negotiations.
Prenuptial and Postnuptial Agreements
A considerable number of high-net-worth families have prenuptial and postnuptial agreements in place. These agreements are designed to basically negotiate the outcome of a divorce in advance of the marriage to minimize the fallout and legal expense that would otherwise occur during a contested divorce case. However, if one spouse was forced to sign a prenuptial or postnuptial agreement, the document may be considered signed under duress and is therefore invalid and/or unenforceable.
Child Custody and Support
When you get divorced in Georgia, both parents are required to provide financial support to their shared children. According to the GA child support and custody guidelines under Georgia Code § 19-9-1, one parent will typically be ordered to pay child support to the primary or primary physical custodial parent.
There are many factors that will be taken into consideration when determining how much child support will be ordered and what your parenting plan looks like.
Some of the factors considered in high net worth and addiction divorces include:
- The family’s standard of living prior to divorce
- Nanny or daycare services required for the primary custodial parent to work
- Extracurricular activities, including summer camps and recreational sports
- Private school tuition
- Any special educational or medical needs of a child
- Both parents’ income and expenses
- Tutoring or other educational expenses
- Your parenting plan and custody arrangements
In divorces involving untreated addiction, if the other parent believes that due to your untreated addiction you could be a threat to the children’s safety or well-being, they may attempt to use your disease against you in your divorce. It is more common than you might think for one parent to try to maintain sole physical and primary legal custody rights, especially when they do not recognize addiction or substance abuse as a disease or medical condition for which you need treatment, just as any other disease or mental disorder.
If you are sincerely working on being in active and long term recovery, then our team will do everything possible to protect you from your spouse’s attempts to utilize your disease as a weapon for their own benefit, especially in your high-net-worth divorce. To protect your assets, we may be able to help you revise an existing trust or set one up for your children. This way, you can protect your child’s financial future.
Maintaining Your Lifestyle
Major lifestyle changes are still commonly required and necessary even in high-net-worth divorces. When addiction is involved, these changes may be necessary for a successful recovery. How marital assets and property are divided, whether alimony is awarded, and your child support and custody arrangements could all impact your future and post-divorce wellbeing, as well as your children’s.
The Impact on Your Business
It is common for high-net-worth individuals to be involved in several business ventures. Married couples will often have similar financial interests, which can make it more difficult to divide business assets. If you hope to protect your business from a loss due to your spouse’s addiction, you need a powerful legal advocate on your side who has experience negotiating these sensitive matters.
Privacy Considerations
Families with a high net worth may be considered to have a higher profile. Business leaders and celebrities may have additional privacy concerns, particularly if one spouse is dealing with addiction and the family hopes to keep this information out of the public eye. You should be able to rely on your family law attorney to protect you from media attention and protect your sensitive financial information.
A Powerful Emotional Impact
When a drug or alcohol addiction has contributed to the end of your marriage, the divorce process can be particularly emotional. Substance abuse can be traumatic for the entire family, and many spouses allow feelings of betrayal and anger to exacerbate an already contentious divorce. We may be able to refer you to mental health counselors and other support services that can help you cope during this difficult time in your life.
A Lengthy Court Battle
You might have hoped to get your divorce finalized as soon as possible, but when one spouse has addiction issues and you come from a high-net-worth family, you should realistically expect for a prolonged divorce process. When you and your spouse are unable to come to terms, these decisions can have an extreme financial and emotional toll. Working with a reputable divorce lawyer may be your best opportunity to resolve contentious issues sooner.
Connect With a Nonjudgmental and Strategic Divorce Attorney in Atlanta Today
When you are struggling to cope with addiction and the end of your marriage, you need a legal representative on your side who can help you protect your rights and your children’s stability.
With Chambers Family Law handling your case, you can expect compassionate and nonjudgmental legal help addressing child custody, parenting plans, alimony, and division of your marital property and assets.
When your business and high-value assets are involved, your divorce requires specialized legal knowledge and training. Do not hesitate to contact our legal team to discuss your impending divorce proceedings.
You can reach us by phone at 404-795-5092 or through our secure contact form to schedule your confidential consultation.