Yours, Mine and Ours

One of the most popular misconceptions I hear is about separate accounts. Many people seem to believe that by simply placing an account in their own name, it is non-marital property. I also hear the same rationale for debts, especially credit card debts. Many people seem to believe that, if a credit card is in the name of one spouse only, that debt belongs to that spouse. This is not always the case.

Under Florida law, a marital asset is anything acquired or enhanced during the marriage regardless of how it is titled. Basically, every dollar earned during a marriage belongs equally to both parties. If one spouse has a separate account and deposits his/her paycheck that was earned while the parties are married into that account, the account now has marital funds. Even if the account was opened prior to the marriage and was, at one time, a non marital asset, there is now an issue with commingling of the funds in that account. The same may be true for retirement accounts.

When it comes to credit card debt, just as money earned during the marriage belongs to both parties equally, debts that were acquired during the marriage are the equal burden of the parties. At least, this is the starting presumption. There are several factors that can affect whether the debt is marital and how it should be divided, and paid for, especially when it is in the name of one party and not both. And it is also important to keep in mind that, even if a Court Order or settlement agreement states that a party is responsible for a debt, this will not stop a creditor or collection agency from collecting from the party whose name is attached to the debt. If the debt cannot be transferred to the party who will be responsible for it, there must be some safeguard in place to protect the party holding the debt in case the other party does not pay.

Florida family law attorneys can help guide clients about how to divide assets and debts. Anyone facing a divorce should seek the consultation and advice of an attorney before signing any agreement or proceeding with divorce.

The above is intended for general information purposes only and should not be considered legal advice. It is highly recommended to consult with an attorney before making any decisions or signing any settlement regarding the division of assets or liabilities.

State Sues Sperm Donor For Child Support

A Kansas who man donated sperm to a lesbian couple is now faced with a child support action from the state. The man and the couple signed an agreement that the man would not be responsible for child support. The state, who has paid out benefits to the couple, is now seeking to be reimbursed and is seeking child support from the man.

      Generally, sperm donors have neither legal rights nor support obligations to a future child. In this case, the donor responded to a Craigslist ad and decided to make a voluntary donation to the couple. According to the article, the man and his wife have no biological children, but have a foster child. He is quoted as saying that he simply wanted to help a couple have a child. Had he donated sperm through a physician or agency, he would likely not have received child support and paternity papers from the state.

      This may seem to many to be a case of no good deed going unpunished. But we need to keep in mind that it is the rights of the child that the state seeks to protect. It would seem to me that, if the man is forced to pay child support, he would have cause to seek reimbursement from the couple to whom he donated. But, since they appear to be collecting state benefits, it is likely that they do not have the resources to reimburse the donor.

      One thing is clear: anyone seeking to participate in the fertility process through donation or surrogacy should consult with a family law attorney. A Florida family law attorney can guide you to the appropriate agency and help you take the proper steps to make sure that the selfless act of helping a couple conceive a child does not result in an unexpected burden.

http://news.msn.com/us/child-support-claim-rankles-sperm-donor-to-lesbian-couple-1

Avoiding the fiscal cliff in divorce

There has been much talk about the fiscal cliff and how to resolve it. The basic formula seems pretty simple- spend less and earn more. Anyone following the news lately knows that this was anything but simple for Congress. When it comes to divorce, many people face a similar fiscal cliff issues- do I increase my “debt ceiling”? And, what do I do when there’s not enough money to go around? Unfortunately for divorcing couples, you can’t just raise more money in the form of taxes (and there is no government fund for alimony. Yes, I have been asked that question). So that brings us to the common dilemma of the recently separated and newly divorced: How do you avoid going over the fiscal cliff? Much like our government, the formula is often the same.

 

1. Cutting spending: The unfortunate reality of divorce and separation is that each party has less money and more expenses. The family’s income now has to pay for two places to live and all the bills that come with two households. One person may be paying child support and/or spousal support to the other. Since each side has less money and more bills, the short term solution is either to raise the debt ceiling (take on more credit card debt of loans, which is not a good idea) or to cut expenses. Cutting down on spending is painful, especially when you are dealing with the loss and adjusting to the changes of divorce and separation. But it will be much easier to find things to go without in the short term that to pay off the excess spending in the long term.

 

2. Increasing revenue: Yes, the economy is still tough, but finding an additional source of income will help pay those additional expenses both parties now have (let’s not forget the cost of moving, buying new furniture, setting up all of those utility accounts, etc. And, yes, there are probably those lawyer fees too). In many divorces, after the combined income has been split in whatever way was agreed upon or ordered by a Judge, both parties often feel the loss of the additional income. Even if there is enough money to pay the expenses, there is less to put into savings and less for life’s little or not so little luxuries. Since you can’t increase taxes like Congress did, finding a way to earn a little more will help ease the transition from married to separated or divorced.

 

As we learned this week, there is no perfect formula for avoiding a fiscal cliff. But there are steps you can take to prevent your own fiscal and emotional crisis down the road.

Seven Deadly Sins of Divorcing Women

We have all heard of the seven deadly sins, and most of us can name at least a few. When it comes to women and divorce, the transgressions are not gluttony, envy or pride, but they can be quite damaging. Below is a list of what I call the seven deadly sins, or biggest mistakes commonly committed by divorcing women.

1. Asking for too little: Women often feel guilty about divorce and responsible for their spouse. As a result, women often shortchange themselves in divorce settlements, accepting less than they deserve or, in some cases, less than what they need to live. I strongly encourage my clients to work towards settlement, but also stress that settlement must be fair. Under Florida law, both parties are equal partners to a marriage and there is no fault in ending it. The main goal of settlement is not just to close the marriage chapter but to make sure both parties have enough resources to go forward. Settling for less than an equal share and not enough for the wife and children to live on is simply not fair.

2. Asking too much: On the opposite side of the spectrum, some women have unrealistic expectations about what to expect from a divorce settlement. Rather than listening to their lawyers, many seek the advice of friends, relatives and others who divulge the details of their divorce settlements as though they are the norm, rather than the outcome of their specific set of circumstances. Many couples spend tens or hundreds of thousands of dollars litigating their divorce because one party believes they are entitled to more than the law will allow. Much like the deadly sin of greed, unrealistic expectations can be emotionally and financially costly.

3. Avoiding confrontation: By nature and nurture, women are taught to be non-confrontational while men are taught to be assertive. Men tend to have less trouble taking a strong stand while negotiating or litigating. Many women tend to want to keep the peace and, even in the midst of a divorce, will back off from asserting a reasonable position or pursuing something to which they are entitled. While most divorces can, and should, be settled, there are instances where it is necessary to go forward. In a highly emotional state, it is difficult, if not impossible to know the difference. But not taking a stand can be as costly an error as taking an unreasonable one.

4. Sweating the small stuff: Divorce is emotional for both parties, but men and women handle it differently. Men tend to hide their emotions by fighting or withdrawing while women allow their feelings greater reign. While this is an important part of the healing process, it leads many women to focus on details which, while important, are not legally relevant. This, in turn, leads to a lack of focus on the important aspects and increased costs as a result of fighting over things that are not worth the money spent to litigate them.

5. Paying to high a price for comfort and security: One of the first questions my female clients ask is whether they can keep the home. One of the first questions I ask them is whether they should. Many women will sacrifice everything to remain in the marital home. While it is the right decision if financial circumstances allow for it, maintaining a large mortgage and household expenses can leave a woman with an overwhelming financial burden. Deciding to stay in the home, either by buying out your spouse or taking the home in place of alimony, is not a decision that should be made for emotional reasons, but for sound financial ones.

6. Forgetting that knowledge is power: More and more women are wage earners, but a significant percentage still have no knowledge of joint assets and finances. One party, in many cases, the husband, makes all financial decisions. At the outset of divorce, women in this situation spend considerable time and money investigating the financial picture and, in worst case situations, trying to locate hidden assets. Those who are equal partners in financial decisions or, at least, have knowledge of money expenses, accounts and assets, are in a far better bargaining position.

7. Waiting too long: Many people, men and women alike, take a long time to reach the difficult decision to end a marriage. Trying everything to make it work, a step I highly support, is one thing; but there are those who, when faced with the knowledge that their partner is depleting assets or even planning for divorce, take the hiding-their-head-in-the-sand approach and do nothing for a period of time. It is understandable that it takes a great deal of strength to reach the decision to divorce, but, in these circumstances, waiting too long can prove disastrous. By the time these women file for divorce, debts may have become too large to handle without liquidating assets and money may have disappeared without a trace.

Finding the right lawyer at the right time can help avoid these costly mistakes. A knowledgeable and neutral advocate can provide much needed advice at this difficult time. Even if the woman has engaged in any of this costly behavior, a divorce attorney can help reverse the damage before an agreement is reached and the case is closed, preventing a costly mistake from having a permanent outcome.

No really, you keep it: The one asset that neither party wants

In this time of recession and falling home prices, neither party wants to keep the house anymore. As this article illustrates, there are options to break the We Can't Afford the House deadlock. Word to the wise: simply quit claiming the house to your spouse does not get you off the hook for the mortgage. Make sure you are protected credit wise and against a possible foreclosure in the future.

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