Posts Tagged ‘divorce issues’

Can I Get Half of My Husband’s 401K in a Divorce?

Wednesday, September 18th, 2019

While it is possible to be awarded some of your former partner’s 401k, it is certainly not a given in every divorce. A family court judge must approve and sign a Qualified Domestic Relations Order, commonly referred to as a QDRO (kwa-dro), then the plan administrator must also approve it since the administrator is accountable to the government if the order is insufficient in any regard. This order provides details to the admin of the 401(k) how to divide the account, in compliance with the Employee Retirement Income Security Act, or ERISA. In an equitable distribution state, the court makes their determination largely based on factors such as the spouse’s financial situation, their respective ability to earn income, as well as the length of the marriage, in order to divide the assets in a fair and reasonable manner.

The QDRO must detail the process for collecting the money that the wife desires, and will direct the admin how she would like to proceed. The wife can roll the proceeds into her own retirement plan, or she can also choose to leave her share intact with the husband’s in the existing plan, taking her payments when he retires. Another option is that she can elect to take the money as a cash payment.

The distribution of assets like retirement accounts can be complicated but is a very important aspect in the grand scheme of the settlement. The longer the marriage, and concurrently, the more contributions that have been made to the account during the marriage, plays a major role when the court is deciding how to assign distributions. 

The QDRO must detail the method the wife chooses and direct the plan administrator how she wants to go about the process. The proceeds can be “rolled over” into her own retirement plan if she has one, or she may leave the share intact with the existing plan, taking her payments when it is collectible, upon retirement. A third option is simply to receive a lump sum payment. 

Does It Matter Who Files for Divorce?

Wednesday, September 11th, 2019

While there are no set-in-stone advantages of being the spouse that initiates the divorce by filing in court, the inherent nature of being the filer, as opposed to the responder, is what makes it the more desirable position of the two. 

By filing, it can be presumed that you have met with your attorney, and have a basic idea of what you will be seeking in the divorce, besides the termination of the marriage itself. In contrast, the spouse who is receiving the divorce notification then has to find an attorney and file a response. You also have the choice of venue, meaning where the case will be heard, which is a luxury considering that, if the roles were reversed, you may have to appear in the state you formally resided in with your spouse even if you had just recently moved upon separating. 

The petitioner, or the spouse that files, is granted the opportunity to make their initial argument first at trial. Again, while this is not always the case, this can potentially make an impression on the court that influences the outcome of the overall divorce, however slightly. 

The real advantage of filing first is that you will have had the time to meet with multiple attorneys, and thoroughly vet them in order to find the one you feel most confident in having represent your interests. Once you make that decision, you still have the opportunity to formulate a loose plan of attack before going into the divorce process – a luxury the respondent will not have.

Unique Divorce Issues That Affect High Net Worth Couples

Tuesday, September 3rd, 2019

Although the legal system does not change the divorce process for couples with a high net worth (usually in excess of $1 million in liquid assets), there are unique, moderating circumstances that arise in these divorces that, by their nature alone, do not present themselves in the alternative group of divorces. Absent a prenuptial agreement, an instrument being increasingly utilized as time goes on, battles over extremely valuable assets create a whole new realm of distribution, as there are a plethora of new variables to consider.

For instance, you may have separate property going into the marriage, but it appreciates in value during the marriage. In this scenario, the spouse who benefited from the asset, but was not the listed owner can potentially receive a percentage of the increase as part of the settlement. Assets are valuated, and either distributed in their entirety, with entire ownership assigned to one spouse, or the asset is divided and proportioned out to each spouse. What makes this unique is that most assets of married couples are not divisible the way an investment portfolio or ownership in a company is, as well as the high value attached. 

Not only is the division of assets a stage of the divorce process that differs, but the awarding of alimony does as well. The spouse seeking support will often make a claim that they are “accustomed to a certain lifestyle”, which inherently implies a certain financial requirement needs to be met. This lifestyle is one that the majority of the population does not have the financial income to support, and so figuring out the exact circumstances of this lifestyle take time and a lot of accounting of both the financial/spending history of the spouses, but the living environment and day-to-day life as well. A lawyer may help explain these issues to the client. 

The complexity and uniqueness of such a divorce only make it that much more crucial that your legal representation understands all that is at stake in your divorce, and an effective lawyer will be able to identify the assets and interests you may be entitled to – even if you don’t know it yourself.