Sometimes the division of assets during a Colorado divorce is a straightforward matter; for instance, when spouses rent a home and have few assets, or own a single property and agree to sell their home and divide the proceeds. But how does the Colorado Court divide luxury assets?
Under Colorado’s Uniform Marriage Act, R&RE, p. 1016, § 1. C.R.S. 1963: § 90-1-1, the law requires divorcing spouses to divide their marital assets fairly and equitably, while each spouse may retain their separate property. The way spouses or the court divide luxury assets depends on which category each asset falls under.
Understanding Separate vs. Marital Property In Colorado
Some states are community property states, where spouses must divide their marital assets 50/50. Colorado takes a different approach. While the court strives for a near 50/50 division, it requires an outcome that both spouses in a Denver uncontested divorce, or the court in a contested divorce, considers fair, with each spouse beginning their post-divorce life as equitably as possible.
Under this law, separate property includes all assets owned by one spouse before the marriage, inherited by each spouse during the marriage, or gifted to a spouse during the marriage, except for jewelry given by one spouse to the other.
Marital property in a divorce includes all assets and property acquired during the marriage, regardless of whose name is on the deed, account, or title.
Full Financial Disclosures and Property Valuation for High-Asset Divorces
During the disclosure period of a divorce, both spouses must submit financial affidavits, listing the full value of their assets. This begins with property valuation and appraisals for all accounts and property, including luxury assets in high-net-worth divorces. Luxury assets often include:
- Vacation homes
- Rental properties
- Luxury vehicles
- Antiques
- Collectibles
- Valuable or high-end jewelry
- Artwork
- Yachts
- Motorhomes
- Private planes
- Designer clothing, shoes, and handbags
Luxury and high-end assets often require valuation or appraisals by specialists before spouses may begin negotiations to divide and distribute them fairly.
Negotiation and Mediation to Reach a Settlement Agreement
Once it’s been determined which luxury assets are marital property, subject to division, spouses may begin negotiating for a settlement agreement. Under the state’s requirement for a fair and equitable division of assets, the spouses and their Denver, CO divorce lawyers can compromise by choosing assets of equal value.
For example, if one spouse wants to retain a luxury yacht, they may exchange it for a vacation home of equal or near-equal value. If one spouse wants to keep an expensive painting, they may agree to allow their spouse to keep a valuable stamp collection, and so on. Often, a professional mediator suggests creative solutions to facilitate a fair distribution that satisfies both spouses and the court’s requirements, thereby achieving an uncontested divorce.
When spouses cannot resolve disputes over one or more luxury assets despite negotiations and mediation, the divorce becomes contested rather than uncontested. In a contested divorce, both parties present their testimony and arguments to the court, along with their financial disclosures and property valuations. Then, the court carefully considers the arguments and evidence to determine a fair and equitable distribution of marital property, including luxury assets.
A contested divorce is far more costly, time-consuming, and contentious. For these reasons, an experienced Colorado high-asset divorce lawyer is a strong ally to assist divorcing spouses to reach a low-conflict settlement agreement.