Your Financial Life May Cross Borders

Out-of-State and International Assets in Pre-Divorce Planning

Not every asset in a Florida divorce is located in Florida.

A family may own a mountain home in North Carolina, investment property in Georgia, inherited land in another state, a condominium outside the United States, an overseas bank account, or an interest in a business operating internationally.

When your financial life crosses state or national borders, pre-divorce planning becomes even more important.

The first question is not simply where the property is located.

The questions are:

What is it?
Who owns it?
How and when was it acquired?
What is it worth?
And how can any eventual agreement or court order actually be carried out?

Property Does Not Become Irrelevant Because It Is Somewhere Else

Florida’s equitable-distribution statute requires courts to identify and distribute marital assets and liabilities and to separately identify nonmarital property. It also expressly recognizes interests in real property, retirement benefits, deferred compensation, and closely held businesses.

Accordingly, your pre-divorce financial inventory should extend beyond Florida.

Identify:

• Vacation homes;
• Rental properties;
• Vacant land;
• Family property;
• Bank accounts;
• Investment accounts;
• Businesses;
• Partnerships;
• Trust or beneficial interests;
• Retirement or pension benefits; and
• Other financial interests located or maintained elsewhere.

Do this even if you initially believe the property belongs entirely to you or entirely to your spouse.

Out-of-State Real Estate Creates an Additional Question

A Florida court’s ability to determine rights between parties should not be confused with its territorial control over property located elsewhere.

Florida jurisprudence recognizes the distinction between acting directly upon property outside the court’s territorial jurisdiction and using personal jurisdiction over a party to require that person to act concerning foreign property. The Florida Supreme Court has recognized this in the context of foreign assets.

Practically, this means property located in another state may require additional documentation, conveyance procedures, recording, or enforcement in the jurisdiction where the property sits.

That should be considered before agreeing to a settlement that assumes transferring the property will be simple.

International Assets Can Add Another Layer

Property outside the United States can present additional practical concerns.

Depending upon the country and asset, issues may include:

• Foreign ownership records;
• Local property law;
• Currency conversion;
• Different valuation methods;
• Transfer restrictions;
• Tax consequences;
• Foreign financial reporting;
• Language or translation issues;
• Recognition of a U.S. judgment; and
• The possible need for counsel or professionals in another country.

An asset may appear valuable on a spreadsheet while being difficult or expensive to sell, transfer, or access.

That matters when comparing it to assets located in Florida.

Ask About the Entire Family Financial Structure

International property is not always titled directly in a spouse’s individual name.

Ask whether either spouse has an ownership or beneficial interest involving:

• A family business;
• Foreign corporation;
• Partnership;
• Trust;
• Holding company;
• Investment structure;
• Family property; or
• Estate or inheritance.

A statement such as “That belongs to his family” or “That account is overseas” should not end the inquiry.

Your attorney needs enough information to determine whether your spouse actually has a legally relevant ownership, beneficial, trust, inheritance, or other financial interest.

Value Is Not the Same Thing as Usability

Suppose one spouse receives a foreign property valued at $500,000 and the other receives $500,000 in a Florida brokerage account.

The numbers look equal.

The financial realities may not be.

The foreign property could involve taxes, transaction expenses, currency fluctuation, restrictions on transfer, carrying expenses, or difficulty selling the asset.

Pre-divorce planning should therefore evaluate more than gross value.

Ask:

What is this asset actually worth to me after taxes, costs, risk, and the practical ability to use or sell it?

Add Cross-Border Property to Your Financial File

Our Pre-Divorce Financial Planning Checklist includes a dedicated section for property and financial interests outside Florida or outside the United States.

Begin identifying:

• Where the asset is located;
• How it is titled;
• How and when it was acquired;
• Its estimated value;
• The currency involved;
• Related debt;
• Available statements or ownership documents; and
• Whether marital money was used toward the property.

Do not transfer, liquidate, retitle, or move property because divorce is anticipated without consulting counsel.

Allow Perez-Calhoun Law Firm to Help You See the Entire Financial Picture

When property extends beyond Florida, identifying the asset is only the beginning. Classification, valuation, jurisdiction, taxation, and enforcement may present different questions.

Allow Perez-Calhoun Law Firm to help you with your pre-divorce planning and determine what additional legal or financial professionals may be appropriate before important decisions are made.