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Stock options can be part of the marital estate

On Behalf of | Nov 6, 2023 | Divorce |

Oklahoma law allows you to receive a portion of the marital estate when your marriage ends. Executive compensation is typically considered part of the marital estate, even if it hasn’t been paid. There are several variables to be aware of when accounting for stock options or similar forms of compensation in a divorce settlement.

Classifying executive compensation

Stock options that are obtained during a marriage are typically classified as joint property even if they are paid out at a later date. However, they may be classified as separate property per a prenuptial or postnuptial agreement. In such a scenario, you would not be entitled to profits obtained after exercising those options. However, you may challenge the terms of a prenuptial agreement during divorce settlement talks. It’s also possible to ask for other assets in exchange for classifying stock options as separate property.

When stock options are marital property

If stock options are considered marital property, you’ll need to figure out how much you think they’ll be worth several years after the divorce occurs. You may decide that you’ll receive a set percentage of any profits realized when they are exercised. You may also accept a set amount upfront to hedge against the possibility that they won’t be worth anything because the company fails or the stock price remains flat.

Tax documents, bank statements and other records may hint at the presence of executive compensation or other assets that your spouse is trying to hide or obscure. If you discover these assets after a settlement is reached, it may be possible to reopen your case to account for items that should have been included initially.