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Dealing with a bitcoin account in divorce

On Behalf of | Dec 28, 2017 | Divorce

When a couple in Maryland is getting a divorce, and one person has a bitcoin account, this could raise several issues. Bitcoin could be an asset that is relatively easy to conceal. In fact, some websites encourage using it for this very purpose.

Another potential issue is how it should be valued. For example, the value of a bitcoin might be calculated at its purchase rate or its current market value. A spouse might also have a choice of how to take a share of a bitcoin account. There might be a lump sum payout, or a person might want a percentage of its value over a period of years.

In the past, bitcoin was not very common, well known or valuable. As its value increases, it may also become more relevant in divorce cases. The acquisition of bitcoin could even contribute to a divorce since it takes a commitment of time and effort to build a valuable portfolio.

These may all be issues that might have to be worked out by the couple, their attorneys or a judge. However, even for assets that are not bitcoins, similar issues might arise. A person might still try to conceal assets whether it simply involves moving all the money out of a bank account or more sophisticated methods, such as offshore accounts. There might also be issues around how to divide assets. For example, splitting a home might involve one person buying out the other, but neither may have the liquidity to do so. Even if the house is put on the market, it might not sell right away. Assessing the value of an asset like a home or a retirement account for property division may mean also taking into account factors such as the costs of upkeep in the case of the home and potential taxes and penalties for the retirement account.

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