Stock Options and Other Non-Cash Compensation

Many high earners are also high level corporate executives who earn much of their salary in the form of non-cash compensation including stock options, retirement benefits, expense reimbursements, and allowances.  Unfortunately, the standard divorce process is ill suited to these situations because the family law codes are written to manage more typical situations where the couple earns only wage income. In a divorce, a failure to properly capture non-cash compensation can have a tremendous negative effect on child support and spousal support. 

Challenges include:

• How to best value corporate stock options? (the normal CPA training is weak in this area)
• How to address incentive stock options vs. retention options (you should know which type you have)
• How do we value “perks” such as housing allowances, ex-pat compensation, jet access and meal reimbursements?
• What share of pensions and retirement plans go to each spouse?
• Once these assets are valued and assigned, how do we transact the equalizing payment?

Our Solution:

We have valued hundreds of options contracts in the process of marital dissolutions and as investment professionals.  Beyond simple Black Scholes analysis, we are able to understand the complex volatility and compound option considerations that can have a significant effect on option value.

We can value any option contract no matter how complex it is and we can testify results with high levels of skill and credibility.

We are experienced at collecting and evaluating the right compensation information as well as ensuring that it is considered as a part of the divorce process.