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Stock and stock options divided in divorce

When someone makes a proposal of marriage, he or she may genuinely believe that the relationship is all about love. However, if the one he or she marries files for divorce years later, the process that results will likely not be about love but instead be about money. For many couples, money encompasses not just the dollars in their bank accounts, but everything associated with either of them on which a material value could even conceivably be placed.

In many divorces, material assets includes one or more homes, vehicles, jewelry and other tangible things that could be liquidated for cash. One spouse’s future earnings and expected pension may also make the balance sheet and be subject to division if there is no premarital contract precluding that. Increasingly, additional assets on the dividing table include stock options and restricted stock.

Both of those are likely to have a significantly different, and potentially greater, value over time. This can make attaching a precise dollar figure to them at the time of a divorce difficult. For that reason, their worth is often a matter of contention between divorcing couples.

A new report advises couples to approach the issue by conclusively determining what stock options and restricted stock their soon-to-be ex-husband or ex-wife has. With that established, their worth can be assessed. However, some states provide for both to be considered marital property only if they have vested by the time of the separation. Other states don’t impose that requirement, but still have a number of factors that are used to determine the current value.

These assets are just one of the many parts of a divorce settlement. Some Louisiana divorces may include them, while others do not. A qualified attorney can help couples to determine what they need to know about these and other potential marital assets.

Source: Forbes, “Dividing Stock Options And Restricted Stock In Divorce” Jeff Landers, Mar. 19, 2014

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