USA Asset valuation in divorce

Aug 10, 2020
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United States
Trying to understand how to value an asset in divorce.

Say as of 1/1/2020, an asset was worth $1000. Of this, $500 was deemed (by forensic accountants) husband's premarital. Had the divorce taken place then and there, husband would get $500 + half of marital portion ($250), total of $750, and wife would get half of marital portion ($250).

Fast forward to present day. Asset is now worth $2000, a gain of 100%. If valued as in above, husband would get $500 + half of $2000-$500=$750, a total of $1250, and wife gets $750.

This is straight forward, but does not account for premarital portion having participated in the growth of the asset. If we consider this, then premarital becomes $1000 (same growth as the asset itself). This means husband would get $2000-$1000=$1000, plus half of the remaining amount ($500). Wife would get $500.

Does anyone know which is the correct method?

Thank you.


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