If you are in the process of divorce there are always many things to consider. For those employees who receive restricted stock, stock options and bonuses, it is important to look at the historic nature of the payments as well as when the stock or bonuses are earned.
Generally, any money earned during the marriage is considered to be a marital asset. As such, if you earned your bonus in a year that you were married and it is not paid out until April of the following year, that bonus is likely considered to be marital and subject to division.
Bonuses which are not yet earned may be considered to be non-marital or may be a mixed asset. Mixed assets are basically partially marital and partially non-marital. Similarly, stock options may have been earned but the value of them is not realized until and unless they are exercised. Stock options will give the employee the right to purchase the stock at a given price at some point in the future. The hope is that at the time the option may be purchased that the value of the company stock will be higher. For example, you may have the option to purchase stock at $100/share in August of next year. When August comes, if the stock is trading below $100/share, there is no value and no reason to exercise the option. If the stock is trading above $100/share, there is value of the difference between the current price and the option price.
Litigants and their counsel should be certain to uncover what stock options, bonuses and other shares may be available in the future, then decide how to divide those assets. If the employee must remain at the current company in order to receive the stock, bonus or options, then the asset will be mixed, since the realization requires additional work.
If you are considering divorce with high earning individuals, significant assets, and/or various income distributions please discuss your case with an experienced domestic relations attorney. For consultation in Northern Kentucky, contact Michael Bouldin at mike@bouldinlawfirm or call 859-581-6453.