Complex Employment Benefits in Connecticut Divorces: Stock Options, Restricted Stock, and Severance
You may be wondering how complex employment benefits like stock options, restricted stock, and severance are handled in Connecticut divorces. Many people receive benefits beyond their salary, paid time off, and medical benefits. Defined contribution benefits like 401(k)s or defined benefit plans like pensions through their employers are quite common, especially with people who work at large companies and government. More and more often, we are also seeing even more complex benefits.
Complex Employment Benefits in Connecticut Divorces
Complex benefits packages that are being increasingly common for Freed Marcroft’s Connecticut divorce clients include:
- Stock options
- Employee Stock Ownership Plans (“ESOPs”)
- Restricted Stock Units (“RSUs”)
- Deferred Compensation Plans
Can Complex Benefits Like Stock Options Be Divided by a Connecticut Divorce Court?
Many people are under the misconception that these types of benefits cannot or will not be divided by Connecticut courts. Connecticut is an “equitable distribution” and an “all property” property division state. “Equitable” does not mean equal, or even half, but rather what the Superior Court considers fair. “All property” means that the courts have jurisdiction over all the property that both spouses have, marital and separate.
Just because these types of assets can be divided doesn’t mean that it’s easy to divide them. Uncovering and determining the best way to handle these assets is complicated. Many are future benefits, making them complicated to value. In addition, some have significant tax implications including restrictions and possible penalties.
Read: Stock Options & Divorce
The Comprehensive Connecticut Property Division Guide
How to divide property is one of the most important issues in divorces. And, it’s one of the most confusing. There are no set formulas or rules on how property will be divided. The good news is that creates tremendous flexibility for experienced divorce attorneys to craft an individualized approach. In order to prepare to make solid and informed decisions, you need to understand how property division works. Our Comprehensive Connecticut Property Division Guide tells you everything you need to know about property division in Connecticut.
Now that you have more information about the complex types of employer benefits that can be divided in Connecticut, you know that it isn’t simple. Considering the level of discretion courts have when dividing marital assets, it is vital to have experienced divorce counsel on your side. There is a lot of opportunity for creative negotiations, strategy, and solutions.
Our first step at Freed Marcroft, the Goals & Planning Conference, is designed to get to the heart of your problem and unveil your true goals. Then, we take those goals along with the facts of your case and analyze them so that we can present you with recommendations and options on how to move forward.