What Maryland Litigators Need to Know

When a divorce involves significant wealth, everything becomes more complicated— especially property division in divorce. Maryland’s equitable distribution model gives the court discretion to divide marital assets fairly, but not necessarily evenly. That flexibility can benefit your client, or harm them, depending on how well you prepare.

High-asset divorces demand more than basic legal knowledge. They require a deliberate, well-informed strategy that accounts for valuation, tracing, tax implications, and financial nuance. Whether you're negotiating or litigating, a knowledgeable approach can significantly change the outcome.

Focus on Accurate Valuation and Timing

High-asset divorces rarely involve simple math. You’re often dealing with closely held businesses, multiple real estate holdings (which may be income producing), intellectual property, investment accounts, unvested restricted or phantom stock, retirement plans, and sometimes art or luxury collections. These assets aren’t easily captured on a balance sheet, and they rarely stay still.

In Maryland, property is typically valued as of the date of dissolution, unless evidence supports a different date for a more equitable value. You can leverage, if you have specific and compelling evidence. Also, timing matters. If a business is projected to grow in value, one party may want to delay proceedings. If a property is depreciating, they may push to accelerate.

Valuation is also an area where mistakes can become costly. A business may show low profits on paper while generating substantial owner benefits. Real estate may be undervalued if appraisers overlook rental income or critical information impacting value. As a litigator, coordinate early with accountants, real estate professionals, and valuation consultants to ensure your numbers hold up in court.

Uncover Hidden Assets and Misclassified Property

When significant money is on the table, it's not uncommon for one spouse to try to shield or obscure what they own. That may include offshore accounts, trusts, digital currencies, or funneling assets through business entities.

Maryland law considers all property acquired during the marriage as marital unless one party can prove it’s separate. That makes tracing essential.

For example, if one spouse claims a beach house is non-marital because it was a gift or inherited, you’ll need records showing how it was funded, maintained, and titled. If marital funds were used for improvements or mortgage payments, the court may still classify it as marital property subject to distribution. Title is also an important factor.

Subtle tactics like delaying bonuses or manipulating business expenses can also hide income. Be on alert for:

• Sudden drops in reported income
• Unexplained transfers or “loans”
• Business valuations that don’t align with lifestyle
• New entities or trusts created during separation
• Restricted stock units awarded, but not accepted

Strong discovery practices—including subpoenas, depositions, and forensic reviews—can expose these tactics. Courts don’t look kindly on parties who attempt to game the system, and uncovering misconduct can shift the balance of the property division in your client’s favor.

Strategize Around Tax Implications and Settlement Structures

Property division in divorce is just the beginning. How that property is structured post-divorce can impact your client for years. That’s where tax planning becomes essential.

Consider two assets worth $500,000. One is a cash account. The other is stock with a low cost basis. Your client could owe six figures in capital gains tax if they later sell the stock.

Be sure to account for:

• Capital gains and income taxes on certain assets
• Penalties and taxes from retirement account transfers without a QDRO
• Depreciation recapture on real estate
• Differences in taxation when offsetting different assets

Maryland doesn’t tax property transfers between spouses in divorce. But your client’s long-term tax exposure should drive negotiation strategy. Secure assets that will grow in value or provide steady income without a massive tax bill. Beware giving your client illiquid or high-tax assets that create future cash flow issues.

Work with financial advisors or tax professionals to build a clear, forward-looking picture. Your role is to advocate for a division that not only looks fair on paper but works in the real world.

Address Asset Liquidity and Cash Flow Needs

A valuable portfolio doesn’t always mean financial stability. High-asset clients often have substantial wealth tied up in illiquid assets—businesses, commercial real estate, long-term investments, or pensions. If your client ends up with assets they can’t tap, they may struggle to meet expenses post-divorce.

That’s why liquidity matters just as much as value. A spouse who gets the family business may face years of limited access to cash, while the other walks away with offsetting liquid assets or stream of buyout payments. One may have retirement accounts locked up for decades, while the other has taxable brokerage funds available immediately. One may retain a home with substantial equity, without adequate liquid resources to maintain it.

When negotiating or litigating, consider:

• How quickly assets can be converted to cash
• What income streams your client will rely on
• Whether they’ll need to sell assets to cover living expenses or legal fees
• How debt or liability is attached to the property they receive
• Whether income producing assets are taxed at capital gains or income tax rates

You may need to fight for a mix of asset types—not just high-value ones. Think about real estate with rental income, investments with dividends, or buyout arrangements that pay over time. A well-structured settlement should give your client flexibility and financial breathing room—not just a high net worth on paper.

Move Forward with Clarity and Confidence

Dividing property in a high-asset divorce is one of the most complex aspects of family law, and one of the most consequential. Every financial decision echoes long after the divorce is finalized. As a litigator, your preparation and strategy can make the difference between a client’s stability and a lifetime of setbacks.

I help clients across Maryland navigate the toughest property division cases with skill, discretion, and care. If you're facing a high-asset divorce and need experienced guidance, my team and I are ready to help.