Many people fail to realize divorce requires more than simply signing a few documents. If you’re divorcing in Massachusetts, don’t be blindsided by the many decisions you’re about to face regarding the division of your marital property. Not all property is valued or taxed in the same way; therefore, the process can be long and confusing without the help of a knowledgeable attorney at your side. It’s important to consider that even though different financial accounts are valued at the same amount, the account owner may receive different withdraw amounts. This is because withdrawals will not be taxed in the same way from a money market, for example, as other accounts would be. The division of retirement accounts can be particularly daunting. There are currently no tax codes or other regulations in place regarding IRA accounts. This has allowed courts to permit IRAs to be divided between divorcing couples. Regarding real estate property, if one spouse is granted full control of the marital home, for example, or vacation properties, then he or she is usually expected to pay taxes on those properties as well. Debt is another matter you will need to be well-informed about when dividing property. No matter who is awarded the property, debt owed is still the responsibility of both parties, if the property was jointly owned. This means in the event the awarded party cannot fulfill payment obligations, the bank or other entity holding the debt will expect the second named party to fulfill payment obligations.
Divorce is as much a financial blow as it is an emotional one. Alimony and child support may take a large, even unreasonable amount out of your monthly paycheck. Conversely, if your income is much smaller than your soon-to-be-ex-spouse’s, or if you stayed at home to look after the family, you might find yourself in dire financial straits if you are not awarded a just settlement. You deserve a divorce settlement that takes into account your circumstances and your contributions to the marriage— and financial, logistical, or emotional. In this article, you will find three steps to follow to protect your assets in divorce and reach the settlement that is best for you. I. Be Open and Honest—and Savvy On your end, it is important not to hide any of your assets. Hiding your assets, or even appearing to hide your assets, may be used against you in court by your spouse and his or her counsel. In fact, most people’s attempts to hide their assets—by spending large amounts of cash—fail to improve their divorce outcomes. This is for two reasons. First, because Massachusetts family courts take into account income (earnings) rather than expenditure (spending). Second, because assets are defined as more than cash, excessive spending fails to protect non-liquid holdings like stocks, bonds, and even intellectual property. To understand the full scope of your assets, it is worth investing in professional help to you value and locate them. This way you can have the knowledge you need to II.
If I make my living in the arts, does my spouse have a fifty percent share in rights to my artworks and the income they produce?
Yes and no. Yes, in the sense that artistic works, along with patents, trade secrets, and many other “intangible” properties, constitute intellectual property. And intellectual property, in Massachusetts, is marital property. No, in that Massachusetts does not assume “equal” (fifty-fifty) distribution of property between partners at the dissolution of a marriage, but rather “equitable.” Intellectual property falls under the requirement for equitable distribution. In dividing something intangible, such as the rights to artistic works, Massachusetts family judges will, as with other forms of property, assess the relative contribution of partners to the marriage financially, emotionally, and logistically. Intellectual property has two sorts of value to be divided. The first is the rights to income from future royalties on a work or idea. Second, the present monetary value of a work or idea. For creators or inventors, it may be wise to include provisions in a prenuptial agreement to protect your intellectual property. If you need help drawing up a prenuptial agreement, or if you are currently involved in a divorce without one, call our office today for expertise in handling intellectual property division.
Somewhere around 2007, a new phrase entered the vocabulary of the divorce attorney: “gray divorce.” It was once virtually unheard of for couples who had been together for decades to divorce, no matter how decayed the bonds of their matrimony — now, it’s becoming much more commonplace. Some divorce attorneys think they know the reason for the trend — it’s really as simple as the fact that human longevity has increased. People are living longer and staying healthier well into their seventh and eighth decades. Only a few generations past, someone who was aged 60 or older might decide that the hassle of a divorce was pointless, given how much longer he or she expected to live an active lifestyle. Now, people approaching their 60s are seeing a future for themselves with another 20-25 healthy, active years and deciding that they don’t want to spend the last 20-25 years of their lives in a miserable marriage. Hopefully, you can avoid joining their ranks by following a few simple pieces of advice; — Don’t assume that just because you’re okay with the marriage that your spouse is also okay with the marriage. Talk about where you each are, emotionally, as you start to approach those “gray” years. — Take a frank assessment of your romantic life. Is it what you need it to be? Have all the other hassles of life gotten in the way and made you forget to pay attention to that part of your relationship? It’s time to
Because the current political climate has taken a darker turn toward immigrants, a lot of foreign nationals are “tying the knot” with their American brides and grooms almost impulsively. Marrying a United States citizen is one of the quickest ways to achieve your lawful permanent resident status, or green card. However, an impulsive marriage could raise red flags with immigration officials, especially if it includes a prenuptial agreement. Immigration attorneys say that many of the international couples who are rushing their weddings are also getting prenups — just in case the marriages don’t work out — to protect their assets. Prenups aren’t unusual, especially for professional couples with considerable wealth. About 14 percent of couples have them. A prenup would seem like a reasonable thing to do, especially if a couple is marrying after a whirlwind romance or a long-distance love affair. However, most of those couples don’t have to worry about an Immigration and Customs Enforcement agent investigating whether or not the marriage is a fraud designed to get around restrictive immigration laws. If a marriage is deemed a sham, the consequences can be serious — it could include deportation, the inability to return to the United States or even incarceration. One of the many things that ICE agents look at when they determine if a marriage is real is whether or not the couple has jointly-held assets and mingled their funds. A prenup may make that difficult to do because it’s essentially designed to keep that from happening
Hidden assets are a major concern for divorce lawyers. Not only are they illegal, they can end up causing major headaches down the road. That’s exactly what lies behind the troubles facing the Worcester Polytechnic Institute in Massachusetts. The Institute was gifted a total of $63 million over the years by it’s largest benefactor — which certainly has earned him some significant accolades that he must value far more than the money. Unfortunately, it seems like a portion of those funds were part of the marital assets that he actively hid from his wife at the time of their divorce. Now, she would like her portion paid back — which could put the Institute in a crunch if it has already spent or allocated the money to one of its programs. It will also likely tarnish the reputation of its benefactor permanently, despite the size of his donations. The Institute’s benefactor and his wife of 50 years divorced in 2010. During the process, the benefactor stated that he did not have any offshore accounts — conveniently forgetting about a tidy $4.5 million tucked away in a Swiss Account. That $4.5 million became part of a larger donation — $40 million — transferred to the Institute in 2014. The Institute’s benefactor may have thought that he was safe from his ex-wife’s scrutiny by then, or that the money would be able to transfer undetected, but that clearly wasn’t the case. Perhaps he thought that it was simply too late, now that
Many couples end up living together at some point to save money on rent and simply for convenience because they’re together all of the time anyway. After awhile, they may end up buying furniture together and splitting the cost of utilities and other household expenses. Too few consider drawing up a cohabitation agreement. However, if a couple has lived together and merged their finances for a period of time, a cohabitation agreement can protect them financially if they split up or if one of them passes away. Many people balk at the idea of a cohabitation agreement for the same reason the couples hesitate to get a prenuptial agreement. They don’t want to contemplate the possibility of a break-up, and assume that if they do go their separate ways, they can resolve property and other financial issues amicably. However, things can get ugly in a break-up and people’s decisions can be driven by emotion. That’s why it’s essential to have legal protections in place so that you don’t suffer financially. Remember that a break-up isn’t the only thing that can put you at risk. What if your partner is suddenly killed in a car accident? What evidence do you have that you paid for at least half of everything the two of you own and that you’re entitled to keep it? If you and your partner have decided to live together in anticipation of one day getting married or perhaps instead of getting married at all, you should consider drawing
A little over a decade ago, the federal government acted to prohibit joint consolidation of loans. However, for couples who opted to consolidate their loans, often to get a better interest rate, prior to that, separating out who owes what in a divorce can be difficult and sometimes impossible. One spouse can get stuck paying far more than he or she owes individually, particularly if the other spouse declares bankruptcy or doesn’t have the means to contribute to the repayment. With student loans, that can run into the tens of thousands and possibly hundreds of thousands of dollars. Paying off one’s own student debt can take decades. However, if your name is on a consolidated loan, you could end up paying your ex-spouse’s debt or risk harm to your credit score. Some people have urged federal legislation that would allow student loans consolidated before such consolidation was banned to be split. However, even though this could impact thousands of people, experts say that’s likely not enough for legislators to consider it worth the time and effort to address the problem. People with joint consolidation loans can apply for repayment plans based on each person’s income. However, that requires the cooperation of both spouses, who must provide financial information. Estranged spouses may not want to cooperate if it would mean more money out of their pockets. In relationships where there has been domestic violence, the victim may well not want to have any contact with his or her abuser. According to
Most attorneys recommend that couples draw up a prenuptial agreement before they get married. Even if they don’t have significant resources or debts going into the marriage, a prenup can detail how marital assets will be divided in case of a break-up. If you don’t have a prenup, you can draw up a postnuptial agreement at any time after the marriage. Like a prenup, a postnup can designate how property and other assets will be divided in case of a divorce. Postnups are more likely to contain stipulations about spousal and child support than prenups. Some people also include language regarding what additional assets or support a spouse may have to part with if he or she is unfaithful during the marriage. Many couples decide to get a postnup if the fortunes of one spouse change significantly, making him or her by far the wealthier. Sometimes, one spouse seeks a postnup upon starting a business in order to protect it. If one spouse decides to take time out of the workforce to raise children, he or she may seek a postnup as financial protection if the marriage ends. In other cases, couples realize that they have very different attitudes toward money, and one spouse wants to protect his or her assets. Some couples draw up a postnup if their marriage is troubled. However, it’s best to draw up this agreement while your marriage is still healthy. It’s best that both spouses have their own attorneys when getting a postnup, just
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