Dividing Stock Options in Divorce

How Do You Split Stock in a Divorce?

Like other marital property, Georgia uses equitable distribution to separate property, investments, and debt based on each spouse’s financial needs, income, and other factors.

Understand Your Stock Options

Stock options are often part of an employee’s benefits package. Stock options allow an employee the right to buy company stock at a set price at a future date. This set price is lower than the future trading price, so employees can profit when they choose to sell.

Vested & Unvested Stock

Vested stock is stock that an employee owns outright, without conditions of employment. An individual may sell or transfer vested stock even if they leave the company.

Unvested stock shares are promised to an employee but retained (restricted) by the employer under the terms of the vesting schedule.

Stock Options as Marital Property

Marital property (including stock) is subject to division in divorce.

Stocks are considered marital property if acquired or vested because of either party’s “labor or investments” during the marriage.

To discourage financial disparity after divorce, the court usually considers the contributions of the lower-income-earning spouse or a spouse who sacrificed their career and significant income potential to stay at home.

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Stock Division & Legal Protection

Dividing stock options in divorce is complicated, mainly if they are unvested. With an extensive background in high-asset division, our team is ready to protect everything you’re entitled to and provide realistic answers regarding:

Comprehensive Financial Audits

People are not always forthcoming about their income, benefits, and financial resources during a divorce. Hiding assets is sadly a common occurrence in a high net-worth divorce. Not knowing about your spouse’s stock options and other employee compensation can have significant financial consequences.

Stock options and restricted stock don’t appear on tax returns or other financial documentation until the stock is vested or sold. A comprehensive financial audit can help ensure that all assets are on the table. Our firm uses forensic accountants and business valuation experts to find hidden assets and ensure you receive your fair share of their value.

Evaluating Restrictive Stock

Stock value is based on anticipated conditions. Although financial professionals can make educated assumptions, there is always the risk of overvaluing or undervaluing.

Our firm consults with subject matter experts to avoid an unscrupulous spouse from hiding a financial windfall. We parse through the portfolio carefully to determine the best assumption of the stock’s future value. Then the stock can be exercised, sold, or transferred.

Non-Transferrable Assets

Some stock options and restricted investments cannot be transferred to a spouse. A spouse will have to sell and split the proceeds in those cases.

Equal Value Compensation

You have the option of not receiving a share of the stock options in exchange for assets of equal value (or with the potential to appreciate to equal value). Again, a divorce attorney and financial professional can help you understand different scenarios’ potential rewards and risks.

Learn About High-Asset Divorce

We Are Ready to Help Divide Your Stock Options

Employee stock options, 401(k)s, and vested amounts acquired during a marriage are subject to division. The court considers both financial and non-financial contributions that helped create these assets.

If you are the higher-earning spouse with stock, you’ll want to know how Georgia law impacts these benefits. If you’re divorcing a spouse with more income and vested stock, you deserve to know how your contributions to the marriage affect your fair share of these assets.

The Gentry Law Firm helps with every aspect of dividing stock in a divorce:

  • Comprehensive Audit to Uncover Assets
  • Dividing Stock Options and Retirement Plans Equitably
  • Considering the Vesting Period & Schedule
  • Consulting with Financial Professionals for Tax Issues
  • Fair Split of Other Marital Assets & Investments
  • Negotiating and Litigating for Favorable Support and Custody As Needed.