Generally speaking, a dissolution of marriage is a quick and simple process that allows couples to avoid the complexity of a traditional divorce. However, factors such as dividing investments in a dissolution in Ohio can make things a bit more challenging.
For Ohio dissolution cases involving investment account division, you will need to know how fair division works so that you stay compliant with Ohio law.
In this article, we will discuss the process of dividing investments in an Ohio dissolution and tips for dividing joint investments fairly.
Types of Investments to Consider
It’s important that you understand how the process of investment account division works in an Ohio dissolution of marriage. Like a divorce, assets labeled as marital property should be divided fairly between the spouses. And before you can proceed with this process, you first need to identify what types of investments you and your spouse jointly own, including:
- Brokerage accounts
- Cryptocurrency
- Stocks
- Bonds
- Mutual funds
You may also have alternative investments not listed here. If that is the case, you still need to include them so that they can be fairly divided.
How Investments Are Divided in a Dissolution
In a traditional divorce, joint investments would usually be divided according to a court order to ensure fairness. However, for a dissolution of marriage, investment division is usually agreement-based.
You will also have a great deal more flexibility when dividing investments in a dissolution. The same standard rule applies, which is the law that Ohio follows, stipulating that marital assets should be equally divided unless the parties agree on a different division. And for dissolutions specifically, you and your spouse may be able to negotiate on a strategy that doesn’t necessarily result in equal division.
In some situations, there may be investment accounts that could fall into the category of being separate property. For this to be the case, they will usually need to have been created before the marriage or inherited or gifted during the marriage.
To ensure that you are following Ohio law, you should take the additional step of hiring a dissolution attorney in Ohio. This is also strongly recommended for anyone going through a dissolution of marriage as a way of ensuring that the process is fair and your rights are upheld.
Valuation of Investment Accounts
Before you can move forward with dividing investments in a dissolution in Ohio, you first need to value these accounts. Investment accounts often have fluctuating values, which may be hard to determine what is and isn’t a fair division.
You may need to consult with an expert to determine the current market value of your investment accounts. When doing this, it’s a good idea to move as quickly as possible since there are market fluctuations that can rise or lower the value of these accounts quite quickly.
Because the value of different investments can change so significantly in a short amount of time, you aren’t expected to consider their future value. You just need to determine what the value is of these accounts at the time of the dissolution.
Strategies for Fair Division
Due to the nature of investment accounts, there are several different strategies you can use for dividing this type of joint asset. The way you divide investments will depend on the type of investments you and your spouse own, your financial goals, and what you determine to be fair.
- Splitting accounts: A very simple way of dividing joint investments is to simply split the account between the two of you. You can usually do this legally by simply changing the details of each account so that they are in just your or your spouse’s name. However, not all investment accounts will allow this.
- Using other assets: You also have the option of one spouse keeping the majority of the investment accounts, while the other spouse takes ownership of more assets to account for this. This is a good option if one spouse is more active with these accounts than the other.
- Liquidating investments: Another common solution to dividing investments is to simply liquidate them and divide the proceeds. The only issue with this option is that timing is very important due to market fluctuations.
Potential Tax Implications
Even in a dissolution of marriage, there is still the concern of tax implications when dividing assets, such as joint investment accounts. The main concern is capital gains taxes, which can occur if investments have appreciated in value.
Each spouse also needs to consider their future tax liabilities depending on what investment accounts become solely theirs post-dissolution. Depending on your financial circumstances, you may choose to liquidate investments or simply give them to your spouse while you keep other types of assets.
No matter what strategy you choose, you need to ensure you understand the potential tax liabilities and the laws in Ohio.
FAQ Section
Can we keep investments jointly after dissolution?
In most cases, yes. However, this can come with legal risks, so you should not choose this option without first consulting with a dissolution attorney in Ohio.
Do we have to sell investments to divide them?
No. There are several strategies you can use to fairly divide investment accounts without having to liquidate them. This includes splitting the accounts or having one spouse keep the majority of the accounts while the other keeps more assets.
How are crypto assets handled in a dissolution?
Cryptocurrency isn’t viewed any differently than other types of investments. So, any crypto assets jointly owned between you and your spouse will need to be divided.
Get the Help of a Dissolution Attorney in Ohio
Dissolutions are often the best course of action if you and your spouse are on good terms and don’t want to go through the process of a divorce. But if you choose to go this route, you will need to know how to fairly divide joint investments. At Garretson & Holcomb, LLC, our attorneys are here to help with every step of the dissolution process, including dividing marital assets and investments. Contact us today at 513-863-6600 to get the process started with the help of a dissolution attorney.
