For tech entrepreneurs, celebrities, professional athletes, and other high net worth individuals, dividing assets and determining spousal and child support payments can be complex. Many different factors determine entitlement in a divorce in California. Let’s start by taking a closer look at the difference between community property and separate property in a California divorce.


What Assets are High Net Worth Individuals Entitled to in a California Divorce?

In the state of California community property—commonly referred to as marital assets—is divided evenly between spouses. Community property includes all assets acquired during the marriage such as income earned and assets purchased with that income.

There is an important distinction when it comes to asset division in a California divorce. In contrast to community property, separate property is not divided in a divorce settlement. The spouse that acquired the separate property will keep it after the divorce. Separate property includes separately held bank accounts, inheritances that are held separately, gifts from one spouse to another, and monetary damages from personal injury proceedings. To maintain the separateness of these, though, they must not be mixed – comingled – with community funds.

When it comes to entrepreneurs and high net worth business owners, a business started or acquired during a marriage is considered community property. This means your spouse may be entitled to half of your business in a divorce in California. However, if your business was started before you got married or if it’s protected by a prenuptial agreement, it gets a lot more complicated as the community property efforts of the spouse working the business during the marriage or the value increase of it as if it were an investment becomes an entitlement of the community.


Are Entrepreneurs Entitled to Alimony in California Divorces?

Whether or not you receive spousal support (also called alimony) in a California divorce depends on several factors. For starters, a judge will consider the length of your marriage, both you and your spouse’s income, and community property when determining spousal support. Additionally, a judge will take into consideration:

  • The emotional, physical, and financial health of each spouse
  • The lesser-earning spouse’s ability to be financially independent
  • Each spouse’s pre-divorce standard of living
  • Each spouse’s age
  • The higher-earning spouse’s ability to support themselves, dependents, and the lesser-earning spouse
  • Child custody considerations

Under California law, all factors are considered when determining alimony in a divorce involving real estate moguls and high net worth individuals. The intention of spousal support payments is to maintain a spouse’s pre-divorce standard of living.


Are Business Executives Entitled to Child Custody and Support in California Divorces?

Spouses in a California divorce can either have sole custody, share joint custody, or be a noncustodial parent. To determine child custody, a judge will consider the following factors:

  • The best interests of the children
  • Parents’ history of substance abuse
  • Parents’ emotional and mental soundness
  • The preferences of the children who are over the age of 12
  • Any history of domestic disputes including those involving violence and physical or psychological abuse

For executives of fast-growing technology companies and high net worth individuals, you must be able to prove that the child’s best interests are served in your care to be granted custody. Parents who have sole custody typically receive child support to cover their children’s expenses. A parent sharing joint custody might be able to receive child support depending on several different factors that will be considered by the judge.

At Silva & Associates, we help high net worth individuals understand what they’re entitled to in a California divorce. Contact us today to learn more.