Family Matters.
When It Really Matters.

Why do some couples set valuation dates in high-asset divorces?

On Behalf of | Jan 27, 2025 | Divorce

There are many issues that can arise during the property division process of a divorce. Particularly when spouses have extensive marital estates that contain different types of assets, property division can lead to disputes.

Couples sometimes disagree about what assets are subject to division or the most appropriate way to split those resources. There can also be disputes about what assets are actually worth. In scenarios where spouses have to establish agreed-upon values for assets including investments, businesses or real estate, they may need to set a valuation date.

What is the purpose of picking a valuation date?

Asset values fluctuate

The basic reason why valuation dates are necessary in high-asset divorces is that the fair market value of assets can shift dramatically from day to day and month to month. Factors including the international economy or issues with the local school district can directly influence what different resources are worth.

Valuation dates help ensure that attempts to estimate the fair market value of assets accurately reflect circumstances at a specific time. Doing so reduces the likelihood of drastic differences between the valuations estimated by each spouse.

Knowing what an asset is worth on a specific date can provide the basis for reasonable property division negotiations. Many spouses use the date that they filed for divorce or began discussing divorce as the valuation date for their resources.

Learning about the different potential complications of a high-asset divorce can help people handle the process more gracefully. Valuation dates are one of the ways that spouses can limit the conflict related to property division.

Archives

Categories