fb-pixel

What happens to deferred compensation in a Colorado divorce?

On Behalf of | Oct 6, 2021 | Property Division |

Achieving a fair outcome in your divorce requires that you track down all of the assets you shared with your spouse. Some assets are easier to locate than others. You obviously know you deserve a fair share of your marital home and your shared investment account. 

However, some property falls into a sort of a gray area when it comes to divorce. Spouses may not understand if the property is separate or marital property and whether they have any right to claim it in the divorce. 

Deferred compensation accrued by one spouse can easily complicate property division. Will the spouse who can eventually receive that deferred compensation have to share it with their spouse?

When the compensation is earned determines what happens

Deferred compensation is in many ways like a standard paycheck. It is something a worker earns for performing their job. Usually offered to those in executive or corporate positions, deferred compensation can be a way to motivate better performance and loyalty to the company. 

Restrictive terms on deferred compensation often require that someone remains at the business for a certain amount of time before they can cash in that promised compensation. If you or your spouse have accrued deferred compensation during the marriage, the value of that on received income cat influence your property division outcome because the courts will treat it like marital property.  

Even if the court can’t split deferred compensation right away, they can award a portion of its value to the other spouse. Learning about the nuances of high-asset property division will help you fight for what is fair in your Colorado divorce.

 

Archives

FindLaw Network