Non-liquid assets are assets that cannot be easily converted into cash without significant time, effort, taxation, penalties, or potential loss of value. They create challenges in dividing property fairly because they do not provide immediate cash flow.

Before you proceed with a divorce involving non-liquid assets, talk to the knowledgeable family law attorneys at Moskowitz Law Group. You will learn how to divide non-liquid assets, like stock options, private equity, and executive compensation in a New Jersey divorce and how these assets are treated under the law.

What Assets Fall Under the Financial Term “Non-Liquid”

Many New Jersey couples have non-liquid assets that cannot be easily divided. These assets cannot be quickly converted to cash without significant loss, taxation, or penalties, and include:

• Real Estate: The marital home, vacation homes, timeshares, and commercial property.
• Business Interests: Ownership in private companies, family businesses, or professional practices.
• Executive Compensation: Non-vested stock options, Restricted Stock Units, and other deferred compensation plans.
• Retirement Plans and Pensions: Retirement plans and pension plans that do not pay out until retirement.
• Valuable Personal Property: Antiques, art, collectibles, and high-end jewelry.
• Specialized Assets: Carried interest in investment funds, country club memberships, and vehicles.

How Are Non-Liquid Assets Divided in a New Jersey Divorce?

Non-liquid assets in New Jersey divorces are divided according to the laws governing equitable distribution of marital assets. Dividing these assets may require specialized valuation, often by specialized appraisers or forensic accountants, in order to buy out or sell these assets under state law.

If an asset cannot be easily valued or divided, the Court may order the couple to sell it, split the proceeds, and share in any taxation or penalties. Another option is for one spouse to keep the asset and buy out the other spouse’s interest in the asset by paying them cash for it or offsetting the value of their share against dividing another asset. For assets like stock options or deferred compensation that have not vested yet, courts may defer division until they vest. Once they vest, the other spouse will get their share as cash.

What Are the Potential Downfalls of Dividing Non-Liquid Assets?

Dividing assets like stock options or real estate can have significant tax implications that must be considered in the settlement. Cash flow shortages and compounding debt issues for the spouse who keeps them are common concerns that should be addressed right away. For in-depth, tailored guidance, seek professional legal advice from Moskowitz Law Group to navigate the complexities of your specific situation.

Find Out How toDivide Non-Liquid Assets in a Divorce

Dividing non-liquid assets, like stock options, private equity, and executive compensation may be confusing. At Moskowitz Law Group, we understand your questions and concerns and have the answers you have been waiting for.

As one of the State’s premier family law firms, you can trust our team to help you understand New Jersey’s equitable distribution laws to seek a fair resolution. Reach out to schedule your case evaluation.