Whether the marriage lasts a handful of years or several decades, it is not uncommon for couples to amass significant assets during their time together. From intangible financial assets such as a retirement plan or deferred compensation to physical property such as a family home or recreational vehicle, the couple must value and divide these assets in divorce. Unfortunately, the parties often overlook certain assets during this process.
What are digital assets?
In the past two decades, individuals have experienced a shift in asset ownership from the physical to the digital. Movies, music, books and videogames, for example, used to occupy shelves in the marital home. Now, people house entertainment collections on a computer hard drive or in cloud storage. Additionally, online storefronts, digital currency and online shopper rewards are all products with significant value yet carry no physical counterpart.
Why is this complex?
Unfortunately, the divorcing couple will often focus strictly on physical assets first and dividing debt responsibility when proceeding through the property division phase. Often, digital assets get pushed aside while the couple focus on the house, cars and family heirlooms.
A significant portion of the challenge in dividing digital assets lies in the valuation process. When comparing an online storefront to a brick-and-mortar business, for example, it can be difficult to properly value the business. Much of the value is dependent upon intangible characteristics such as the intellectual property, web presence and dedicated customer base rather than physical property and stored inventory.
While these factors present a challenge, the divorcing couple must address digital assets when navigating the legal process. In addition to matters of support and developing an effective parenting plan, the divorcing couple must reach an agreement regarding online assets.