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Full transcript by James Nolletti below.
For wealthy couples, the valuation and distribution of assets can be the most important aspects of divorce. The selection of valuation date for a particular asset could make a substantial difference in the amount one gives or receives for it due to any fluctuation in value while a divorce case is pending.
In New York, valuation dates must be between the date the divorce action is commenced and the trial date, and it depends upon what is equitable. What is equitable can lead to substantial disputes.
For example, if the value of a business or a professional practice is greater at the time of trial than it was at the time the divorce actually was commenced, one might argue that this appreciation in value is due to their active individual efforts, and therefore the valuation date should be as of the date the action commenced. However, their spouse might argue that the appreciation is the result of passive market conditions, hence the valuation date should be as of the date of the trial.
Valuation date disputes can involve other types of assets as well, such as real estate and non-discretionary securities accounts where the client, not the broker, makes all the trading decisions.
Once they get over these types of hurdles and the valuation of the asset is determined, the next step is to decide how much of that value, or what percentage of it, should be distributed to each spouse based upon their respective contributions to the acquisition of that asset, to the value and marketability of the asset, and the tax consequences of the proposed distribution of the asset.
