Tag Archive for: property division

Determining who gets the home in a divorce case

Couples in Wisconsin who have made the decision to divorce may find that a variety of other choices now must be made. Those ending their marriage must figure out asset division of everything from household furnishings to the family home itself. As a community property state, Wisconsin courts attempt to divide property acquired during the marriage as equally as possible in most divorce cases, leaving both parties with a comparable share of assets and liabilities.

Lawyers acknowledge that the couple’s home may be one of the more difficult assets to divide, simply due to the high value of a home. Dividing a home equally typically means that the home will need to be sold, with each spouse getting half of the equity. If the home is being lived in during the divorce, the expenses that occur, including monthly bills and maintenance or repairs performed, will usually be split equally as well.

If one individual wishes to keep the house, courts will determine if it is a viable choice by evaluating the budget of the spouse to ensure that they can afford the home and by making sure that the other spouse receives an equal amount of marital assets. Getting an appraisal of the home may be an ideal choice so that both parties agree about the value of the home.

Divorcing couples may be able to agree on property division during a divorce. If couples do not, their attorneys may be able to negotiate an arrangement regarding marital property in order to avoid a trial. Prenuptial agreements are also taken into account when dividing property in Wisconsin.

Source: The Huffington Post, “What to Do With Your House in a Divorce Case “, Christian Denmon, Denmon & Denmon Trial Attorneys, December 09, 2013

Rise in disputes over pet ownership in divorces

Wisconsin residents may be interested in an article discussing the rise in a certain type of custody battle during divorces. Attorneys are noticing that couples are fighting over who gets to keep the pets more and more.

In a recent survey of family law attorneys, 27 percent stated that they have seen an increase in the number of couples who are battling over ownership of pets during a divorce. Under the law, courts regard a pet as an item of personal property. In that way, pets are no different than other pieces of property, such as furniture and jewelry. Most often it is a dog that is at issue in the split, comprising 88 percent of animal disputes. The second most frequent animals fought over in divorces are cats, at merely five percent, followed by horses and “other.”

In some cases, ownership of the pet is used as a hardball negotiating tactic during divorce proceedings. Due to the emotional attachment that many owners have to their pets, this makes dealing with pet custody more akin to child custody than property ownership. Upkeep costs are also similar, as pets often have expenses associated with their care. As with child custody issues, it is probably best for couples to deal with who retains ownership of the pet on their own, rather than leaving it up to a judge.

Even though courts are becoming more accepting of pets as assets in property division during divorce, it can be helpful to negotiate an agreement regarding future ownership outside of a judge’s chambers. An attorney who is experienced in a property division issues may be helpful in negotiating a fair custody agreement for pets and other marital assets.

Source: Mainstreet, “Pet Custody Battles on the Rise in Divorce Court”, Juliette Fairley , February 21, 2014

Divorce settlement conditions may be prudent

A recent divorce settlement dispute may be instructive for Wisconsin residents. A father of two emancipated children divorced, and the father’s relationship with the daughter had become strained. She had graduated from Rutgers University and been accepted at Cornell Law School. The father had agreed to a divorce settlement that required him to pay 50 percent of his daughter’s postgraduate education. The cost of Cornell was $74,580 per year for room and board, tuition, books and fees.

The father objected, arguing in court that he should not be obligated to pay citing personal financial difficulties, the availability of less expensive schools, his poor relationship with his daughter and his understanding that the mother had inherited money for the daughter’s education. The trial court disagreed, finding no language in the divorce settlement that supported the father’s argument. The New Jersey Appellate Court upheld the decision.

The courts generally consider a divorce settlement agreement to be contracts that have already been sanctioned by the divorce court. Unless significant changes in circumstances or issues about the legality of the contract itself can be proven, the courts will usually not rewrite or alter the terms of the contract. The settlement wording made no condition upon which the father would pay half the costs. The father was ordered to pay $112,500 as his portion of the Cornell education.

Divorce may become a complicated and emotional process. Arriving at an equitable settlement may be difficult, especially in cases of high-asset divorce or when complex assets such as stock options, business interests or investment vehicles are involved. An attorney experienced in settlement strategies, asset valuation, tax law and property division may help prevent any unexpected negative consequences of a broadly written settlement.

Source: The Huffington Post, “Divorce Settlements and Higher Education“, Brad Reid, March 13, 2014

Political power couple, art collectors’ divorce not so amicable

Wisconsin art aficionados may be familiar with the art-collecting Washington power couple Tony and Heather Podesta, if not for their valuable holdings then perhaps for their lobbying activities. It seems that the couple’s divorce, part of a split announced in 2013 and characterized as amicable, may not be as friendly as they had originally portrayed.

Tony Podesta filed for marital dissolution in April 2014, accusing Heather Podesta of misleading him about their chances for reconciliation when he provided half the down payment on her new mansion in March 2013. At the same time, he says, she had already started a new relationship unbeknownst to him. In addition, he claims that his wife had contacted prestigious museums requesting that they block him from donating art to them. She is also accused of changing the locks on their shared Italian apartment to keep her husband out. The filing claims that Heather Podesta had sought to harass and embarrass her husband in an effort to gain financial leverage over him.

The Podestas were a major power inside the Washington Beltway during the presidency of Bill Clinton. Tony Podesta’s brother was chief of staff for the White House and later served as a counselor to President Barack Obama. Heather Podesta was formerly a Capitol Hill staffer and started her own lobbying firm in 2007.

Power couples may face as many emotional challenges as those less influential when it comes to filing for divorce. Property division, child custody and spousal support are contentious legal issues that many face during the marital dissolution process. However, divorce attorneys can provide guidance so that their clients can keep control of the assets that really matter to them.

Source: The Washington Post, “Tony Podesta divorce filing: wife Heather Podesta tried to ‘embarrass and harass’“, Emily Heil, April 03, 2014

Divorce may have outsize impact on couples’ tax status, liability

Wisconsin couples both married and unmarried may know that marital status has an effect on the taxes they have to pay. A wedding means it’s time for a change in their tax situation, but so does a divorce. Filing status may be the first change that comes to mind when thinking about how life events affect one’s tax burden, but sharing expenses and income as a married couple can have a large impact at tax time.

Financial planning experts frequently offer tips to taxpayers trying to figure out their new obligations to the Internal Revenue Service. They suggest what some may already know: Filing status is important for figuring one’s tax burden, possible exemptions and credits such as the one for earned income. Whatever a taxpayer’s marital status is at 11:59 p.m. on Dec. 31 of the year for which the return is being filed is that person’s status for the entire year. Until a divorce is final, each spouse still falls into the “married” column.

Being married or single isn’t the only filing status; should a household include a qualifying dependent, a single person can file as the “head of household.” When it comes to married couples, choosing to file a joint return means that each spouse shares equally in any tax liability imposed by the IRS. Married people can choose to file as “married filing separately” to avoid this commingling, but doing so may take away eligibility for certain credits as well as expose each spouse to higher tax rates.

Filing for divorce is just the first official step in dissolving a marriage. Important divorce legal issues such as property division, alimony and child support may still need resolution. Family law attorneys may be able to help divorcing spouses access resources that could contribute to an outcome agreeable to all parties as well as represent divorcing spouses in court proceedings as needed.

Source: Yuma News Now, “How Marriage And Divorce Can Impact Your Taxes”, April 05, 2014

Identifying all assets can be challenging during a divorce

Some of the most contentious disagreements that arise during a divorce revolve around the division of marital property. It is not uncommon in Wisconsin for individuals involved in a divorce to attempt to conceal assets from their spouse. Because finding hidden assets could significantly impact the size and scope of the final settlement, it is important to do everything possible to discover all marital assets before the proceedings are finalized.

Making a formal legal request for a complete report of all financial accounts and outstanding debts can be an important way to begin a search for hidden assets. Issuing a subpoena for financial documents could provide a reluctant spouse with an extra incentive to be more complete in their disclosures. Loan applications are another type of financial document that could provide important clues about a spouse’s assets, since the loan application process often requires significant and detailed documentation of assets.

Examining tax returns is another way to identify clues that could lead to assets that an individual may have been unaware during the course of their marriage. Tax returns can provide clues to taxes paid on previously hidden real estate, investments, or even employees. Whether an asset was hidden or not, it is also important to obtain documentation establishing when the item was purchased. This information can provide a clearer picture of who actually is entitled to maintain ownership of an asset after the divorce.

An individual going through a divorce could benefit from a consultation with an attorney who has experience in this area. Assistance in obtaining an accurate inventory of marital assets can be invaluable in subsequent negotiations of a property division agreement.

Source: NJBIZ, “Industry Insights: Discovering hidden assets in divorce“, Angela Scafuri, April 21, 2014

Financial steps to take when going through a divorce

Wisconsin residents who are about to embark on a divorce may not realize how many financial considerations need to be taken into account in the family law proceedings. Wisconsin is a community property state, meaning that assets acquired during marriage must be equally divided between divorcing spouses. These assets may include income that is not yet in liquid form, such as an IRA or a retirement account. A transfer of retirement funds from one spouse to another could result in unfavorable consequences if not done correctly.

Spouses may use a Qualified Domestic Relations Order to transfer a portion of IRA and other plans to another party without facing negative tax consequences. Individuals may also need to revisit retirement plans and life insurance policies to change the beneficiary designation, and they may also need to change the calculations previously made in their retirement planning.

Another tax consideration presents itself when property is transferred from one spouse to the other. Parties to a divorce should consider their estimated future marginal tax rates as they will stand after a property division is effectuated, since one spouse may have a higher capital gains tax on a future disposition than the other. In addition to separating community property, spouses will also need to separate their finances and the money they hold in joint accounts. Parties should be careful to close all joint accounts and to open separate accounts in order to establish their own line of credit. Parties should also rewrite a mortgage in the sole name of the party who keeps the home.

An attorney may help individuals assess their business cash flow and their personal budget. Individuals may also want to review their estate planning documents and consider them as they relate to a property settlement. Family law attorneys may help individuals conduct discovery to uncover the assets that should be taken into account when negotiating a settlement.

Source: Dentistry IQ, “Important considerations for the couple going through a divorce: Part 2“, Theodore C. Schumann, May 18, 2014

Dealing with the financial details of divorce

Wisconsin residents may be interested in a recent article that discusses how an individual’s finances are impacted during a divorce. There are many important issues to discuss with an attorney or finance professional when filing for a divorce, and many couples do not consider all of the variables without guidance.

One of the most important aspects of any divorce is property division. Absent an agreement between the spouses, courts in Wisconsin will use equitable distribution principles in dividing up marital assets. This does not always mean that the division is necessarily equal. Tax is an important consideration during property division, and it is something that many couples overlook. Income and expenditures can change dramatically after a divorce, and if one spouse is a much lower income earner, it may be advantageous for that spouse to get assets that will have a lower tax associated with them. If a spouse with a lower income ends up with the large family house, for example, they may end up with a tax burden on that property that they cannot afford.

Retirement accounts are also important to keep in mind during a divorce. These accounts are usually factored as part of the property to be divided when the court issues a qualified domestic relations order. Taxation is again a factor here. If one spouse is awarded part of the other spouse’s retirement benefits then they can withdraw that money from the account and roll it over into a new account without the normal early withdrawal penalty that would be applied.

A couple can continue to file their taxes using the joint return status until the actual divorce papers are signed and the order is issued. This can allow both spouses one final term of lower tax before they must file as single.

Source: Nerd Wallet, “Divorce: Making Sense of the Confusion“, J. Kevin Stophel, June 03, 2014

Director deals with major divorce

Wisconsin movie fans may be familiar with director Michael Moore and his current divorce, which one source has characterized as “vicious.” Moore and his wife of 23 years, Kathleen Glynn, are undergoing a split. Sources did not name a specific reason for the divorce, but a major point of contention will be Glynn’s use of marital funds to build an expensive vacation mansion on a lake in the couple’s native Michigan.

Moore’s attorneys are alleging that the building of the house has done considerable damage to his reputation. To back up their assertion, his lawyers have called in two of Moore’s agents, one of whom is the book agent who secured several of Moore’s successful book deals. The agents will attest to Moore’s niche role in Hollywood and how having ownership of the luxurious house has impacted his image as a man of the people.

The attorneys will also be introducing into evidence various news articles about the house, including one that describes it as a sign that Moore is hypocritical. The couple also owns eight other properties in various locations. The divorce proceedings will deal with this aspect of property division, as well as a decision on how to split the millions of dollars earned during the couple’s time together.

For those who are about to undergo divorce for the first time, it may be extremely difficult to determine what to expect. For these people, it may be helpful to talk to a lawyer who has experience in divorce law. The attorney may be able to explain what to expect and help guide the client through the process.

Source: Fox News, “Director Michael Moore enmeshed in vicious divorce“, June 08, 2014

Legal fees owed by ex-spouse of former Dodgers owner

Wisconsin residents dealing with concerns over property division in their divorce cases may be interested in reading about a June 24 judgment handed down in a case involving former Dodgers owner Frank McCourt and his ex-wife, Jamie McCourt. At the time of the couple’s divorce in 2012, Mrs. McCourt was awarded luxury residences that were purchased during the couple’s marriage of almost 30 years. She was also awarded $131 million without tax obligations. However, Mrs. McCourt later claimed that her husband undervalued the baseball team at the time of the divorce. The team sold in the same year for more than $2 billion.

A superior court judge ruled in the case in September, rejecting the claims. Mr. McCourt’s attorneys pursued repayment of their legal fees for contesting the challenge, an amount of nearly $2 million. Although Mrs. McCourt’s attorneys argued that these fees were excessive, the same judge ruled that language included in the divorce judgment is clear about the obligation of any party contesting the result to reimburse the other’s legal costs. The judge additionally noted that she was involved in the team’s operations and that she had access to and help from many attorneys and accountants prior to the settlement being completed.

As the judge indicated, the language of the divorce judgment denoted an intent to end the matter at that point, and the parties had the opportunity to consider the terms carefully. It is important to understand the implications of a divorce judgment before accepting it, and a party who does not understand the terms may want to seek the assistance of an attorney for clarification.

In some cases, there may be issues in which a spouse has not fully disclosed the value of an asset, resulting in a judgment that may later seem unfair. In such a case, an attorney may assist in exploring the options for pursuing remediation.

Source: ABC News, “Judge Favors Frank McCourt in Divorce Fees Fight“, Anthony McCartney, June 26, 2014