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Mistakes to Avoid During High Net Worth Divorce

October 27, 2021/in Family Law /by Gina Policastri

Divorce proceedings are never simple, and high net worth divorces tend to be even more complex and contentious. When couples have several or higher-value assets, they have more disputes to settle and divorce proceedings often become lengthy and spiteful. It is common for people going through a divorce to make rash decisions; however, it is important to remain level-headed during the litigation process and educate yourself on the mistakes to avoid during a high net worth divorce.

Understanding High Net Worth Divorce in California

California recognizes community property in divorce proceedings. This means that property acquired during a marriage is considered community property and should be divided equitably during a divorce proceeding. While this may seem like a straightforward process, there are many intricacies in the law, which is why hiring a divorce attorney who is experienced with high net worth divorce cases is highly recommended.

While your divorce attorney will tackle most of the complicated tasks, there are several mistakes that you want to avoid in order to protect your assets.

1. Don’t Spend Lavishly Before or During the Divorce

There is a misconception that it is wise to indulge prior to a divorce proceeding. This habit often backfires as debts are also accumulated during divorce proceedings and judges can consider selfish spending when making litigation decisions. Contrary to popular belief, increasing your spending prior to the divorce will not increase your alimony payments. You could also end up having to reimburse your spouse for frivolous spending leading up to dissolution proceedings.

2. Don’t Try to Conceal Your Assets

Since California practices community law, many spouses are tempted to conceal their assets during divorce proceedings. This is not only illegal, but it is also insensible as they will most likely be discovered during the discovery and settlement process.

3. Don’t Blindly Follow The Advice of Your Family or Friends

It is common for people who have experienced divorce to believe that they are experts in divorce proceedings, however, they are often misinformed. It is important to to avoid drawing conclusions from one person’s case. When it comes to decisions regarding how you should handle your financial assets and decisions regarding your divorce, the advice that you should value the most is the person you have hired to give you advice – your divorce attorney.

4. Don’t Try to Rush Through The Settlement Process

While many people ending their marriage wish to dissolve it quickly, acting too quickly or making rash decisions is not recommended. High net worth divorce proceedings will take significantly longer than regular divorce proceedings and hastily reaching agreements can result in one person making huge sacrifices simply to expedite the process. Just as it isn’t recommended to rush into a marriage, it isn’t advisable to hurry out of one.

5. Don’t Sell Yourself Short

It is easy to become intimidated by your spouse and their team of divorce lawyers, but it is important to fight for your equitable share of assets. If you are entitled to alimony payments, take them. You never know what life will throw at you and how much that could influence your future.

6. Don’t Fight to Win Every Battle

While you don’t want to give in to an aggressive spouse, you also don’t need to win every battle. There are going to be certain assets that you will have to walk away from. It is important to have a conversation with your divorce attorney at the early stages of the divorce to determine what you value most and what is worth fighting for.

7. Don’t Forget to Update Your Estate Plan

It is important to update your estate plan after major life events, including a divorce proceeding. Lonich Patton Ehrlich Policastri’s team of qualified family law and estate planning attorneys has the resources you need to offer you the best solution for estate planning after a divorce.

8. Don’t Bypass Hiring a High Net Worth Divorce Attorney

The 5 high net worth divorce partners at LPEP Law

Divorce attorneys who specialize in high net worth divorces are going to be more expensive than regular divorce attorneys because they are more qualified, reputable, and have more experience with complex divorce litigation. While it is tempting to opt for the lower fee, being selective with who you choose to fight for your assets is an important step toward investing in your future. If you are facing a divorce with high stakes, please don’t hesitate to contact our offices today for a free 30-minute consultation on how to best protect your future.

https://www.lpeplaw.com/wp-content/uploads/2021/05/LPEP_PC.png 0 0 Gina Policastri https://www.lpeplaw.com/wp-content/uploads/2021/05/LPEP_PC.png Gina Policastri2021-10-27 17:58:432021-12-22 18:17:11Mistakes to Avoid During High Net Worth Divorce

Business Succession Planning for Small Businesses

October 13, 2021/in Business Law, Estate Planning /by Michael Lonich

Business succession planning is the process of determining how you are going to transfer your business ownership and transition out of a business management role while maximizing your personal financial security. It is a critical process that determines whether the transition of a business succeeds or fails. This entails a series of logistical and financial decisions that will prove to determine the fate of business succession.

Why Should Small Businesses Worry About Succession Planning?

There are several reasons:

  • Unexpected events, such as death or disability of you or a business partner. Normally, business succession planning is implemented in view of a predetermined retirement date. However, the chances that there could be an occurrence of unexpected events makes the process more important and urgent.
  • Poor business transition can have negative effects on business results. Consequently, failure of business could occur.
  • The value of your business may represent a substantial source of income in your retirement. Therefore, it is important that efforts are made to implement successful succession planning. You could minimize risks to your retirement capital that way.
  • If you wish to transfer your business to a family member, you will likely need to coordinate your business plan with your estate plan. You will also want to explore any tax deferral opportunities that could benefit you and other family members. 

Types of Business Succession Plan

Various options exist for small business owners to explore if they desire to implement a succession plan. An experienced succession planning lawyer can help you move forward with these options. 

Selling Your Business to a Co-owner

If you founded your business with a partner or partners, you may be considering your co-owners as potential successors. A buy-sell agreement could be implemented in this case.

Passing Your Business onto an Heir

This is a popular option for business owners, especially those with children or family members working in their organization. It’s seen as an attractive option even though most second-generation businesses hardly survive business transition. Lifetime transfer strategies could be implemented in this case.

Selling Your Business to a Key Employee

This is selling your business to someone that works within the organization. Most times, employees in the organization don’t have the financial capacity to buy the organization they work in. Seller financing could be implemented in this case.

Selling Your Business to an Outside Party

This is looking elsewhere other than your family members, partners or employees for potential successors. Entrepreneurs or even your competitors could be the outside party.

Selling Your Shares Back to the Company Upon Death

This is an option available only to businesses with multiple owners. An “entity purchase plan” or a “stock redemption plan” is an arrangement where the business purchases life insurance on each of the co-owners. When one owner dies, the business uses the life insurance proceeds to purchase the business interest from the deceased owner’s estate. This gives each surviving owner a larger share of the business. 

Why You Need a Succession Planning Attorney

The success of succession planning hinges on both financial and legal factors. It involves a lot of details revolving around:

  • The timing of the transfer and how interests will be held.
  • Determination of who will succeed in ownership and management.
  • Transfer tax and income tax considerations.
  • Provisions for family members who are not active in the business.

The input of an attorney specializing in business succession planning is critical to your business’s success. An experienced attorney will be an invaluable asset as you navigate the legal factors involved in succession planning. You don’t have to worry about drafting contracts and agreements if you hire a qualified attorney to do this for you. An attorney plays a key role by drafting a buy-sell agreement, creating matrimonial agreements, creating trusts, and restricting corporate capital. The need for an attorney by small businesses when planning a business succession is a matter of extreme importance and urgency.

To learn more about succession planning, visit us here. Lonich Patton Ehrlich Policastri is a leading law firm in the area of business succession planning. They offer free consultations to anyone within the following areas: Santa Clara, San Mateo, Contra Costa, Santa Cruz, Monterey, San Jose, and San Benito.Contact them today and successfully implement succession planning for your business.

https://www.lpeplaw.com/wp-content/uploads/2021/10/succession-planning.jpeg 912 1368 Michael Lonich https://www.lpeplaw.com/wp-content/uploads/2021/05/LPEP_PC.png Michael Lonich2021-10-13 21:10:042021-12-22 18:17:29Business Succession Planning for Small Businesses

October LPEP Spotlight: Mitchell Ehrlich

October 1, 2021/0 Comments/in 2021, Spotlight /by Lonich Patton Ehrlich Policastri
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Located in San Jose, Lonich Patton Ehrlich Policastri handles matters for clients in northern California, specifically San Jose and Silicon Valley. Our services are available to anyone within the following counties: Santa Clara, San Mateo, Contra Costa, Santa Cruz, Monterey, and San Benito. For a full listing of areas where we practice, please click here.

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