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Fort Myers Family Law Blog

Make sure your divorce doesn't threaten your credit score

A fundamental part of almost every divorce is dividing up assets and liabilities in a fair way that a court will approve. As part of your property division negotiations, it is common for one spouse to assume the consumer credit debts of another to even out property division terms. However, if these issues are not carefully examined and resolved as part of the divorce negotiation, creditors may continue to pursue both parties for payment if one party does not uphold his or her end of the agreement to repay the debt.

This is particularly common when it comes to credit accounts held jointly by both spouses. It is a relatively simple matter to agree that one spouse or the other takes over the responsibility to repay a jointly held credit account. It is a different matter entirely to remove one spouse's name from the debt so that creditors will no longer pursue that spouse for payment if the assuming spouse falls behind.

Don't overlook these assets in a high net worth divorce

Once you decided to seek an end to your marriage in court, you knew you'd likely encounter various challenges throughout the process. Beyond the roller coaster of emotions your friends told you to expect, you also worried there would be difficulty resolving certain issues, especially those concerning property division. Deep down, your hope was to swiftly and amicably negotiate the terms of your settlement so you could put the past behind you and get on with your life; however, you feared it might not be so easy.

After hearing what some of your business colleagues and friends have gone through, especially when it comes to dividing assets, child custody and alimony, you're determined to try to stay one step ahead of the game to minimize stress and quickly overcome any obstacles that arise. The best way to do that may be to research Florida divorce laws ahead of time and also have a support network lined up to help you over the rough spots should any occur.

Alimony deductions removed under new tax law

Few things dominated the news in the last months of 2017 like the overhaul of the tax code undertaken by congress. While many individuals on all sides support or object to various parts of the new tax system, all tax-paying individuals in the country must now contend with the law and the implications it has for tax returns in 2018 and beyond.

One of the most crucial changes to the tax code that may affect divorcing couples is the removal of alimony deductions. For a number of years, individuals paying alimony to a former spouse found some relief in the ability to deduct alimony expenses from their tax returns. Under the new plan, these deductions are not longer available. It remains to be seen how these changes affect the alimony process, since those who pay alimony are often already subject to higher taxes than those who receive alimony.

Legal separation offers struggling couples options

Divorce is complicated process, and while it does resolve many conflicts in marriages that cease to function, it is not the only option that couples have under the law. In some cases, couples may find that pursuing a legal separation allows them to "restructure" their marriage to create a stronger, lasting relationship. In others, a legal separation may simply create a civil, responsible preamble to a successful divorce, offering couples time and space to consider the divorce carefully and ensure that each party receives fair consideration.

Like a divorce, legal separation involves court orders that determine many aspects of property division and parenting during the separation. However, a legal separation is not a divorce, and does not legally dissolve a marriage. In some instances, a legally separated couple may resolve their conflicts responsibly and continue the marriage from a newly built foundation.

Does a business owner need a prenuptial agreement?

Regardless of how much you love and trust the person you wish to marry, if you own a business, you should strongly consider creating a prenuptial agreement. In the lead up to a wedding, the excitement of marriage can cloud the judgment of one spouse or the other, leading him or her to think a prenuptial agreement to protect a business is not truly necessary, because the marriage will go the distance.

This reasoning is very dangerous, frankly speaking, not only for the business owner, but for everyone affect by the business, like employees, vendors and customers. Should the marriage fail without proper protections for the business, the business may count as marital property and included in property division.

Getting off the roller coaster and on the right track in divorce

No one can deny the fact that divorce is an emotionally trying time for those involved. From the parents to the children to extended family, the end of a marriage takes its toll on everyone. Dealing with the emotional roller coaster that can occur at this time is absolutely essential, but you and your soon-to-be former spouse may want to consider how emotions can affect the divorce process.

In order to stay on the right track when it comes to reaching a divorce settlement, and a custody agreement if you have children, those emotions probably need to take a back seat to getting down to the business of resolving your issues. Doing so could open up other options besides going to court.

How much of your marriage's debt should you take in a divorce?

When couples with significant complex assets choose to divorce, reaching fair agreements surrounding property division is often very difficult. This is even true in instances where both spouses prioritize a peaceful divorce process and fair property division terms. While those who have relatively few assets or debts between them may find it possible to quickly divide up a handful of things and go their separate ways, divorces involving robust estates often require complicated assessment and negotiation.

In many cases, this is because a couple's assets and liabilities mix together or because a particular piece of property is both an asset and a liability, like real estate or a business. In order to reach a property division agreement that judge will approve, these divorces often mean taking on debt that you may or may not believe is rightfully yours.

Keep careful records of alimony payments

If you pay alimony or anticipate ongoing alimony factoring into your divorce, then you want to make sure that you keep proper documentation of your payments, as well as a number of other documents and types of information. By maintaining good records, you can avoid unnecessary conflicts with your ex-spouse and make the most of any tax benefits.

While you may not choose to keep every piece of documentation depending on your circumstances, you may want to keep

  • Copies of checks made out to your ex-spouse, including check number
  • Alternative documentation if you do not use checks
  • A written and signed receipt for any alimony payments made in cash

High asset divorce, taxes and avoidable expenses

Divorce is rarely simple, but when a couple with significant assets chooses to divorce, both spouses may have a number of issues to consider that other couples never encounter. In the eyes of the law, divorce is more or less the same as dissolving a business partnership, and requires spouses to agree on a fair way to divide their marital property, including both assets and liabilities. While any couple who divorces must address marital property, spouses in a high net-worth marriage may find that they face significant tax burdens once the divorce finalizes.

If you are approaching divorce involving significant assets, or if you're already in the middle of it, be sure that you seek out professional representation that understands how to truly protect your interests and priorities. You may find that the tax implications or associated costs of keeping or forfeiting a particular piece of property changes your position on the property altogether.

Approaching the prenuptial agreement conversation

Many times, when a couple decides to get married, one party or another wants to work out a prenuptial agreement but just doesn't know how to approach the issue in conversation. This is a normal concern, and many people have legitimate, if misguided, objections to prenuptial agreements. For partners and fiancees who want a prenuptial agreement while their counterpart has reservations, it is important to understand how to frame a discussion of the issues at hand.

If you find yourself in this unenviable position, it is often wise to start by seeking to understand your partner's objections. Many people perceive prenuptial agreements as something a person would only use if he or she planned on the marriage failing, for instance. This a reasonable fear in the sense that some people do use prenuptial agreements that way, but it is far from the only reason to consider one.