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Property Division

Intellectual property is becoming more common in prenups

Prenuptial agreements are becoming increasingly popular among millennials who are entering into marriage. They’ve grown up in a generation where many of their parents have gotten divorced — sometimes after long, bitter battles over property. Therefore, it’s only natural that they’re aware of the possibility of their marriage ending, even though divorce rates in general are in decline. However, a primary incentive for a prenup for young couples may be something more than protecting traditional property, assets and inherited wealth. They’re more likely now to include intellectual property. The last couple of decades have seen the rise of tech entrepreneurs who became multi-millionaires or even billionaires because they had an idea for a software program, an app or a website that became wildly popular. Many people entering into marriage want to protect their right to the fruits of their ideas — even if they haven’t thought of them yet. Prenups can also include intellectual property such as music, screenplays, books and other works of art. They can include ideas for unique start-up businesses. As one divorce attorney notes, prenup stipulations can go “into the future for things that are not yet in existence.” Of course, placing a value on an idea that someone hasn’t even thought of yet can be tricky. However, an experienced Massachusetts family law attorney can help you incorporate language into your prenup that will help you ensure that, in the event of a divorce, you can keep the monetary benefits you’re entitled to for your ideas

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Property Division and a Second Divorce

When a Massachusetts couple is engaged, the last thing on their minds may be how their property would be divided in the event of a divorce. No one want to start a marriage by planning for the details of property division in the event of divorce. Unfortunately, statistics show that over 50% of marriages will not survive.  Couples walking down the aisle for a second or third time, should be aware that this number swells to 67%. Spouses who face a second divorce are more likely to take a greater financial hit the second time around. One reason that a second or later divorce is potentially more financially damaging is simple: there is often less to be divided. One or both spouses may still be paying alimony or child support from a previous marriage. In addition, many people see a decline in their financial stability when a prior divorce forces the sale of assets such as a home or investments. There could also be tax implications as a result of selling off assets to settle a divorce. Factor in a lethargic economy, a slowing job market and a persistent decline in home values, and it becomes easy to see how a second divorce can cause more financial damage than the first. The end of a second or third marriage may also come at a stage in a person’s life when retirement is on the horizon. Spouses may also be experiencing age related increased costs associated with health care. The best

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Divorcing at an older age

Although statistics suggest that the rate of divorce may be stabilizing across the US, one demographic is experiencing in increase in divorce rates. Americans aged 50 and older in Massachusetts and elsewhere are turning to divorce now, more than ever before. A professor at a leading university asserts that in 1990, less than one out of every ten people who filed for divorce were age 50 or older; today, that number has skyrocketed to one in four. Although the reasons for filing for divorce at a later age may differ for each individual, older adults who are ending their marriages share some commonalities. One is a more complex division of marital property, as each spouse may have accumulated a diverse set of assets over the course of their lives. Sociologists suggest that there are many factors that lead older Americans to seek divorce. Many have stayed in lackluster marriages as their children have grown to adulthood, believing that prolonging the split would be easier on their children. Another approach on aging suggests that 50 may be the new 30. Unhappy spouses recognize that they have the potential for longevity, recognizing that there may be a long road ahead plagued by unhappiness in their existing marriage. Additionally, more women are now engaged within the workforce, and are no longer financially dependent upon their husbands for financial stability. The American Association of Retired Persons supports this theory, pointing out that women over age 50 initiate divorce more often than men. It was

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What courts consider marital property

Massachusetts law provides some specific guidelines for the court’s consideration regarding property division in a divorce proceeding. Since Massachusetts is an equitable distribution state, the court is charged with facilitating a settlement that is deemed fair to both parties. This approach differs from a community property division in that “fair” may not necessarily mean “equal.” When a mutually satisfactory division of assets cannot be reached in a divorce proceeding, the court first must determine what assets and debts are to be considered marital property. It must then proceed with an appropriate valuation of that property. Once the property is valued, the court then issues a ruling setting forth a division of property deemed to be equitable. Several factors must be considered by the court in its decision. These factors are defined by Massachusetts statutes, including the length of the marriage, the conduct of the parties during the marriage, the age, health, station and occupation of the parties, the amounts and sources of income, vocational skills and future earning capacities, employability, estate, the liabilities and needs of each party and the amount and duration of any alimony awarded. Additionally, the present and future needs of dependent children must be considered. The court may also consider each party’s contributions with regard to the respective estates, the contributions of each party as homemaker and other specific considerations such as health coverage. The stress of a divorce proceeding can be considerable. Seeking the advice of family law attorney, David M. Gabriel and Associates may

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Divorcing individuals in Massachusetts should examine their finances

Because couples in Massachusetts are not immune to potentially going through divorce, it is important to understand what separation could mean if such a decision is made. Financial needs will differ after a couple separates, and there will be many agreements that will need to be made in terms of alimony and other aspects. As a result, it is important for parties to understand their financial situation before divorce takes place. Bank accounts are one area that should be noted before separation. This examination will allow a party to understand how much money is in those accounts and what division of those funds could mean for their situation. If divorce has been decided upon, opening a bank account that is not shared with the other party is a wise step. Examining the debt that could be taken on after divorce is also an action that an individual may wish to carry out. Attempting to diffuse any accumulated debt before the separation would be ideal. However, many individuals know that it is not always easy to repay balances quickly, and therefore, preparing a payment plan for after divorce could be beneficial. Financial needs are important to assess at any time, but it can make a considerable difference when divorce is on the horizon. Understanding the current state of finances will help prepare for the future and how those funds will be impacted by alimony, child support and property division. Having the right information on such issues can play a role in

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Financial planning during separation is essential

While finances are an integral part of most divorce settlements, the process of divorce can take some time. Meanwhile, if you and your spouse are living apart, your finances are in limbo. This includes everything from joint bank accounts to mortgage payments and other household expenses to your kids’ needs. Even if you and your estranged spouse are getting along well enough to work out these things between yourselves, it’s a good idea to have your Massachusetts family law attorney help you work out a formal agreement — particularly if only one person is the wage earner or has a significantly higher income than the other. That way you have some assurance that necessary expenses will be covered even if the divorce turns rancorous. This agreement can also help as you determine what type of settlement to seek in the divorce. This involves some budget planning. If you’re going to be living separately during the divorce proceedings, as most people do, you each need to create separate budgets to cover your housing, food and utilities. Unfortunately, some couples need to stay together under one roof for a while because they simply can’t afford two households. However, if that situation is untenable, it’s best to work out a way to manage two homes, even if it means cutting back on other spending. It’s best to start separating your bank accounts as well as your credit cards and other debt. As long as your name is on a credit card, he or

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Stock options, though easily overlooked, could be valuable

People who get divorced often think about their rights regarding company-controlled assets. This doesn’t just mean a regular paycheck, but could also mean benefits or a pension plan. One thing they may often overlook, though, is the value of stock options. Stock options typically can be used in the first decade that the employee is with the company. Essentially, they mean that the employee can purchase stock in the company at the date of his or her choosing, buying the stock for the price it is at when the options are offered. This can be very valuable, and this asset may need to be split during a divorce just like anything else. For example, the shares may be worth $10 each when the option is offered. Ten years later, if the company is doing well, the shares may be worth $20 each. The employee can then buy these $20 shares for $10 each, instantly doubling his or her money. This eliminates the risk to the employee, as he or she can stand to see the stock lose significant value and still come out ahead overall. The employee also has 10 years of data to predict what the stock will do. If you’re heading toward divorce in Massachusetts, do not forget to consider stock options. Find out if your spouse has any and what value they may hold. Find out if stock has already been bought or if the right to buy simply exists. Above all else, make sure you know

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How to keep tax planning and divorce separate

Divorce is emotional, and that emotion often interferes with the efficient distribution of the marital estate. Forensic accountants can help by locating all the assets and liabilities for marital division. These specialized certified public accountants can also investigate and analyze financial evidence and interview parties to help prevent fraud. In their tax advisor roles, CPAs helps the parties of the divorcing couples to divide the marital assets orderly and with the least tax burden. Any property that is acquired by the spouses during the marriage is generally marital property. Some retirement plans that qualify under the Employee Retirement Income Security Act are not subject to state laws that govern that govern the division of marital property. The courts determine on what is fair and equitable in 41 states for the division of assets. In the other 9 states, the separate property brought into a marriage will remain separate property as long as it remains segregated and identifiable. When there are possible tax liabilities associated with property division, CPAs can help soon-to-be ex-spouses determine how much they owe due to the divorce so they won’t be surprised come tax time. When many people get divorced, it’s easy to simply consider the immediate concerns, such as child custody, support, alimony and property division. However, the tax implications can be bigger than you might anticipate. By enlisting the help of a CPA, you will be able to determine your tax liability long before a tax bill will come due. An attorney who is

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