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

Florida Alimony Reform: The End of Permanent Alimony in Florida

Last year, a bill was introduced to make sweeping changes to Florida’s alimony laws. The proposed new law would have done away with permanent alimony, and substituted it with “long term alimony”. The original form of the proposed law changed the definition of long term marriage to 20 years, as opposed to the current definition, which is 17 years. The original form of the bill provided that an award of long term alimony could not exceed 60% of the length of the marriage.  In other words, if the marriage lasted 20 years, the long term alimony could last no longer than 12, unless there were special circumstances. This bill did not become law.  A subsequent bill was introduced which was far less restrictive, but did provide that retirement was a change in circumstances which could justify modifying or terminating alimony.  This, too, did not become law.

      But the calls for reform continue, from groups who view the current alimony laws as unfair. The Florida Second Wives Club and the Florida Alimony Reform Movement, which are working hard to get their message across. According to the group’s website, Florida Representative Rich Workman and Florida Senator Kelli Stargel are sponsoring bills in the House and Senate, respectively. Senator Stargel’s bill is aimed at the concerns of the Second Wives Club- to prevent an alimony recipient from, in their words, “going after” the income of the new spouse. In less emotional language, this means that, if a alimony paying former spouse remarries, and the new spouse contributes to household expenses, a Judge can take into consideration the reduced expenses of the paying spouse when deciding whether alimony should be modified.

      It is difficult to predict whether 2013 will bring any attempts to change Florida’s alimony laws. But this is definitely an issue worth watching. Floridafamily law attorneys should be aware of these potential changes so they can help guide their divorce clients through the process.

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 Men

Keeping it fair and balanced. Here is the list for the men:

Men are also prone to errors that can have a lasting impact on their divorce settlements or lives beyond the final judgment. Below is a list of the seven deadly sins of men, or Dad’s, or Ex-Husband’s, whichever the case or appropriate label may be.

1. Fighting for principle: “I will go to court at all costs” and “it is the principle of the thing” are two statements I hear from male clients in negotiations gone south or cases headed to trial. While I never have and never would tell anyone to go against their principles, I caution divorcing clients about the price tag attached to their principles and whether the value gained is worth what is lost as a result. Anyone who finds themselves fighting for “the principle of the thing” should ask themselves what they are really fighting for and if the “at all cost” is worth it.

2. Underestimating child support expenses: Florida’s child support guidelines are supposed to be the anticipated amount each parent should contribute towards the support of their children. But I have seen few, if any Moms or Dads who feel the child support number is “just right” or even right at all. On Dad’s side, there is a common misconception that child support payments are used to fund the now extravagant lifestyle of Mom, rather than benefit the children. In the average household, this is simply not the case. In many instances, child support covers food, clothing, housing and all those little extras that come along, such as school field trips, projects, lunch money, etc. As all parents know, those expenses really do add up. Unless Dad is a professional athlete or celebrity, the guideline amount, while not exactly right in either party’s mind, will not allow Mom to purchase diamonds and firs.

3. The joint custody battle: Websites are devoted to this topic and it’s a popular question in my office as well. When Dad comes in and states that he wants joint custody, I always ask what that means to him. I then ask if he’s comfortable committing to living within a short distance from mom and the kids until they reach 18. In a good number of cases, rotating custody works quite well. But there are those who do not understand the concept or who think they are limited to either “joint” custody or being the “weekend dad”. Unless there are extraordinary circumstances to justify sole custody, Dad remains a decision maker, stays in frequent contact with the kids and continues to coach soccer, softball or any other activities he enjoyed with the kids, with or without “joint custody”. There are many alternatives in between the seemingly all or nothing positions and it is important that Dad know about and consider these options before taking a stance or declaring a “custody battle”.

4. Taking control: While more and more marriages involve equal income earners, or Mom’s outearning Dad’s, this is a popular mistake made by divorcing Dads in what are usually labeled “traditional marriages.” Dad is the breadwinner and decision maker. This Dad may not want to give Mom her share of assets or child support or alimony, whatever the case may be, as Dad believes Mom will not be financially responsible. This Dad forgets the Declaration of Independence portion of divorce- the concept that both parties live separate and free. Mom is responsible for herself, and the kids if the kids live with her. Courts do not allow Dad to monitor Mom’s spending and do not require Mom to account to Dad for this spending. The judge will impose this requirement and fighting for it is a sure way to lose.

5. The alimony dilemma: There are many alimony jokes for a reason. No one likes to pay it. This includes men and women, who are paying alimony more and more these days. But, in that “traditional” model again, its Dad paying alimony to Mom, or, in cases where there are no children, Ex-Husband paying Ex-Wife. Florida law provides guidelines for whether alimony will be paid. In some facts and circumstances, alimony is a given, and, in some of these instances, permanent alimony is guaranteed. I’ve had clients who would do anything to “buy out” this alimony obligation and some that just had to accept it as reality. In some financial circumstances, it is possible to make a lump sum buy out of alimony. The question is whether it is in the parties best interest. This, of course, depends on the facts and circumstances. The no alimony at all costs Dad/Ex-Husband should seek the advice of a trusted attorney to and, in many instances, an accountant, to find out the options or whether there are options in the alimony dilemma.

6. Separated and not equal: This, again, addresses the “traditional” situation of Dad as breadwinner. Dad worked and brought home the paycheck. Mom may have stayed home and raised the kids. Or maybe someone else raised the kids. Or maybe there were no kids and Mom, or, rather, Ex Wife, just stayed home. This Dad/ Ex Husband thinks that since he earned more than Mom/ Ex Wife that he gets a greater share of the assets. In the majority of cases in Florida, what was earned by the marriage, by Dad, Mom, Ex Husband, Ex Wife, interest, appreciation or otherwise, is marital and what is marital is divided equally. If Mom worked less than Dad, or Ex Wife did not work at all, spouses are equal partners in the marriage. Dad may hate it, Ex-Husband may hate it even more, but this is the likely outcome.

7. Not giving an inch to avoid the extra mile: This mistake is similar to the principle argument that can derail settlement or prolong a case beyond what may be necessary. There are often issues which are minor in the big picture but which become emotional sticking points. When clients negotiate, they are asked to give up certain things and make concessions in order to reach an agreement. What can happen is that Mom/Ex Wife is “sweating the small stuff” as discussed in the previous article and asking for one seemingly little extra that Dad/Ex Husband doesn’t want to give, if for no other reason than that Dad/Ex Husband feels he has already given too much. A fine example of a disagreement that isn’t worth the time spent arguing it is the division of frequent flier miles, which have minimal cash value. But when this one last request for ½ of the hard earned miles comes in at the end of a long negotiation, it may often turn into a sticking point and cause both sides to spend more money discussing the item than what its really worth. In some instances, there is greater value saved by giving in than the value that is lost by continuing to disagree.

Divorce is undoubtedly emotional and men and women, generally speaking, react differently in the face of the emotional crisis. While the reaction is understandable, the financial and prolonged emotional consequence can be avoided in some instances. The key to avoiding these mistakes lies in knowing when to advocate for something and knowing when to give in.

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.

Florida alimony changes: new options

Florida divorce law has been given a big change with the passing of a recent bill. Florida judges now have a new option in awarding alimony. known as durational alimony. The law is designed to address situations where permanent alimony is not the best option, but is the only option available. Florida law has prevuously recognized gray area marriages- those of more than a dozen or so years- as situations where permanent alimony may not be appropriate. Now, in those situations, a Florida judge can award durational alimony. An award of durational alimony is for a period of years and can be modified or terminated.

It is too soon to know whether the law will effect cases already pending or divorce already filed or how often durational alimony will be used. When it comes to alimony, entitlement and number of years for alimony are always decided on a case by case basis. Those who have specific questions about their Florida alimony case should contact a Florida family law lawyer for advice.