In a divorce, marital property and debt has to be divided in a just manner when considering all the factors. In some cases, there are not many assets of high net worth. But in other cases, that might not be the case.
One fact pattern thay can be complex is a divorce with trust assets. This can be particularly true where the trust assets have significant value. In these cases, parties often wonder how this will be addressed in the divorce.
The reality is every case is different and every jurisdiction is different. Thus, it is hard to present uniform rules that apply across the board. But below are several factual issues that can be vital to the analysis:
1.) When was the trust created? Was it created before or after the marriage? The answer to this question can make a big difference.
2.) How was the trust funded? Was it funded with assets of the marriage? Or was it funded with pre-marital assets or by another person who is not a party to the divorce? The answers to these questions are usually important.
3.) Who are the beneficiaries of the trust? Is one of the spouses a beneficiary? Do they have a right to receive these assets now or at some point in the future? Or, is the trust discretionary where the trustee has the discretion on when to make distributions in anounts and at times that the beneficiary cannot control? This can be very important.
4.) What kind of trust was created? Is it a revocable or irrevocable trust? The reality is there are various types of trusts out there and what type of trust was created can be vitally important.
5.) Who is the trustee of the trust? Is one of the spouses to the marriage a trustee? Or is it somebody else? If the spouse is the trustee, this can be important.
6.) In some jurisdictions, a Domestic Asset Protection Trusts may have been created in a state where they are allowed? If so, this can be important to know.
These and other questions are all critical to the analysis. This is why it is important for a party to speak to an attorney about these and other questions where trust asset exist in divorce litigation.
In many jurisdictions as well, if one party believes the all or part of the trust assets are marital, it can be important to make the trustee a party to the divorce. Otherwise, the court might not have any ability to enter any type of order relative to the division of trust assets. This makes this an important topic to broach with an attorney.
If you are going through a divorce with trust assets are exist, and you have questions, you can contact Stange Law Firm, PC at 1-855-805-0595.