Stock Options, Restricted Stock Complicate Property Division

Maryland couples may realize that property division — even that involving straightforward assets such as the family home — can be far more complicated than anticipated. The more complex property division becomes, the more unusual the assets that are up for grabs. Financial experts say two types of financial holdings are among the most difficult to value and divide: stock options and restricted stock.

For those who are not familiar with these two types of assets, a quick primer: Stock options allow employees to purchase shares at a previously determined low price. That price is valid for a period of years, during which the worker may purchase and then sell the shares at a profit. Restricted stock, on the other hand, is provided at no cost to workers, but it can only be sold when certain conditions, such as a specified term at the company, have been fulfilled.

Couples who are looking to divide such assets may face some hurdles in determining the exact worth of these holdings. In a volatile marketplace, it can be difficult to speculate about the future cost or value of stock options. Divorce teams for those with this type of complex valuation should include forensic accountants or economists to help determine the potential growth of the assets over time.

Attorneys may help clients receive their fair share of the restricted stock or stock options. A divorce financial planner is a valuable ally during this process, as that person may be able to determine a reasonable division that promotes client interests. It is also helpful to have an idea about your future plans for the stock options, including the time frame in which you intend to exercise them.

A divorce team that includes an attorney may provide the comprehensive support needed during this complex property division scenario. Maryland residents with such holdings may benefit from the assistance of a divorce attorney who can help them learn more about their legal rights. Both parties deserve their fair share of such business assets.

Source: Forbes, “Dividing Stock Options And Restricted Stock In Divorce” Jeff Landers, Mar. 19, 2014